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2020-12-01 22:01:13.975706+00

http://media.ca7.uscourts.gov/cgi-bin/rssExec.pl?Submit=Display&Path=Y2020/D12-01/C:20-1035:J:PerCuriam:aut:T:npDp:N:2621398:S:0

NONPRECEDENTIAL DISPOSITION To be cited only in accordance with Fed. R. App. P. 32.1 United States Court of Appeals For the Seventh Circuit Chicago, Illinois 60604 Argued November 18, 2020 Decided December 1, 2020 Before DIANE S. SYKES, Chief Judge MICHAEL S. KANNE, Circuit Judge DIANE P. WOOD, Circuit Judge No. 20-1035 KEVIN THOMAS LACHER, Appeal from the United States District Plaintiff-Appellant, Court for the Eastern District of Wisconsin. v. No. 18-CV-941 ANDREW M. SAUL, Nancy Joseph, Commissioner of Social Security, Magistrate Judge. Defendant-Appellee. ORDER Kevin Lacher, a 55-year-old man suffering from sustained back pain and limited mobility, challenges the denial of his application for disability insurance benefits. An administrative law judge found that Lacher had the residual functional capacity to perform sedentary work with some limitations. On appeal, Lacher contends that the ALJ erred by (1) not assigning enough weight to his treating physician’s opinion and (2) discounting his subjective complaints. Because substantial evidence supports the ALJ’s determination that Lacher was not disabled, we affirm. No. 20-1035 Page 2 Lacher filed for disability benefits in early 2015, asserting that his pathological back fractures, degenerative lumbar-spine disc disease, left-side joint dysfunction, and high blood pressure prevented him from working. He traced these conditions back to 2008, when he fractured his spine lifting a window for a home-improvement company. Before that, Lacher had served in the Air Force as a heavy-equipment mechanic. A surgery that Lacher underwent in 2010 to repair a torn disk appeared to alleviate his symptoms. He stayed out of the workforce until late 2013, when he began working for a laptop-recycling company. But in January 2014, Lacher complained of back pain to his primary-care physician, Dr. Paul Robey, who subsequently discovered a compression fracture. Lacher underwent another back surgery in March. After this surgery, Lacher still experienced back pain. In October, an orthopedic specialist diagnosed him with a second compression fracture in his spine. Another surgery was scheduled but then cancelled because the fracture was considered too small. Lacher soon began therapy with a chiropractor, and his condition improved to the point where he could shovel snow. An MRI and bone scan from this time showed that the fracture had healed. At a post-therapy checkup in mid-2015, the chiropractor noted that Lacher had minimal to mild muscle spasms and restricted mobility in his problem areas but no longer had significant flare-ups of pain. Based on his back pain and restricted mobility, Lacher applied for disability insurance benefits. He claimed a disability onset date of February 13, 2014—the same day he was laid off from his job dismantling laptops for recycling. Lacher stated that he could not sit or stand for more than 20 minutes, walk more than a block without a cane, lift more than 20 pounds, or bend to pick up something off the floor. He also reported waking up every two hours from pain, for which he was prescribed Valium. In support of Lacher’s application, Dr. Robey submitted a “Treating Source Statement” opining on Lacher’s ability to perform work-related activities. On one form, he checked a box indicating that Lacher likely would be off task at work for over 25% of the time and absent more than 4 days a month. Dr. Robey also noted that Lacher had limitations such as lifting and carrying objects weighing at least 10 pounds (which he could do only occasionally); lifting 20 pounds (rarely); stooping, balancing, kneeling, and crouching (only occasionally); and never climbing stairs, ramps, ladders, or scaffolds. The Social Security Administration denied Lacher’s application initially and on reconsideration, and an ALJ held a hearing on his disability claim. At the hearing, Lacher emphasized that, as of 2015, he could not bend down (such as to put on his socks or pick up after the dog) or sit for more than 30 to 45 minutes without taking a break. No. 20-1035 Page 3 He added that he could walk only about 50 yards before needing to stop, and that he used a cane. Lacher also described days on which the burning back pain was so severe that he could do nothing but find a comfortable position and lie down. The ALJ then questioned a vocational expert about the jobs available to someone with Lacher’s limitations. The vocational expert noted at the outset that Lacher had worked in the past as a laptop recycler—medium, unskilled work—but he actually had been performing the work at only a sedentary level. The expert went on to testify that a person with Lacher’s limited mobility could not perform his past recycling work if he needed to take a break every thirty minutes, but he could do the job as Lacher had actually performed it in the past. Applying the agency’s familiar five-step analysis, see 20 C.F.R. § 404.1520 (a), the ALJ determined that Lacher was not disabled at any time between February 2014 (the alleged onset date) and September 2015 (the date last insured). The ALJ found that Lacher had not engaged in substantial gainful activity since the alleged onset date (step one); that he had the severe impairment of a history of compression fractures (step two); that he did not have an impairment or combination of impairments that met or equaled a listed impairment (step three); that he had the residual functional capacity to perform a range of sedentary work as defined in 20 C.F.R. § 404.1567 (a) (step four); and that he could perform his past recycling work (also step four). In reaching her conclusion, the ALJ explained that she found Lacher’s testimony about the intensity, persistence, and limiting effects of his symptoms “not entirely consistent” with the medical evidence—evidence that he had improved mobility post- therapy and that his fractures were healing. The ALJ gave some weight to Dr. Robey’s opinion, noting that portions of it were consistent with evidence that Lacher had tenderness and a limited range of motion in his back, but other portions were inconsistent with evidence showing normal gait, normal muscle strength, and the absence of any limping. The Appeals Council denied review, making the ALJ’s decision final. See 20 C.F.R. § 404.981 . The district court upheld the ALJ’s decision as supported by substantial evidence. On appeal, Lacher argues—with respect to the residual functional capacity finding—that the ALJ erred by giving only “some weight” to the opinion of his treating physician Dr. Robey. For applications like Lacher’s that were filed before 2017, a treating source’s opinion is entitled to controlling weight if it is supported by sound medical evidence and a consistent record. 20 C.F.R. § 404.1527 (c)(2); Hall v. Berryhill, 906 F.3d 640 , 643 (7th Cir. 2018). When an ALJ does not give controlling weight to a No. 20-1035 Page 4 treating source’s opinion, that opinion should be weighed based on the nature and extent of the treatment, the treating source’s area of specialty, and the degree to which the opinion is consistent with the record and supported by evidence. See 20 C.F.R. § 404.1527 (c)(2). Lacher disputes the determination that Dr. Robey’s “Treating Source Statement” was inconsistent with the medical record, emphasizing the doctor’s February 2015 comment that his back pain likely would not improve and that he likely would have more compression fractures over time. Substantial evidence supports the ALJ’s decision to give only “some weight” to Dr. Robey’s opinion. The ALJ adequately explained why she found that Dr. Robey’s treating-physician form painted a more severe picture of Lacher’s limitations than suggested by the objective medical evidence. She properly assessed the limitations in Dr. Robey’s form, noting inconsistencies between the severe limitations identified by the doctor and physical examinations showing that Lacher had normal gait, muscle strength, and range of motion in his extremities. As the ALJ also pointed out, Dr. Robey attributed Lacher’s limitations to his diagnosed compression fractures without explaining how the fractures restricted his mobility so severely. Although the ALJ could have substantiated her analysis better—for instance, by specifying the portions of Dr. Robey’s form she discredited—she did acknowledge Dr. Robey’s familiarity with Lacher’s condition, directly adopted some of his proposed limitations, and otherwise applied the correct legal standards. Lacher next faults the ALJ for discounting his subjective complaints as “not entirely consistent” with the evidence—a formulation akin to one (“not entirely credible”) that we have identified as “meaningless boilerplate.“ Parker v. Astrue, 597 F.3d 920 , 921–22 (7th Cir. 2010). Specifically, he argues that the ALJ ignored his April 2015 statement that he “cannot sit, stand more than 20 minutes.” But the phrase “not entirely credible” (or “not entirely consistent”) is meaningless only when the ALJ gives no legitimate reasons for discrediting the claimant’s testimony. Martinez v. Astrue, 630 F.3d 693 , 696 (7th Cir. 2011). The ALJ’s rationale here was thin, but it was adequate to reflect her conclusion that the objective medical evidence and Lacher’s daily activities did not corroborate his subjective symptoms. The ALJ acknowledged Lacher’s physical limitations caused by the compression fractures, but pointed to his “normal reflexes, sensation, muscle strength, and gait”; his “reported improvement with chiropractic care”; and his “increased ability in performing some activities of daily living”—including shoveling snow with less pain. True, the ALJ said nothing about Lacher’s self-reported inability to sit for prolonged periods, but Lacher has not identified any objective medical evidence in the record to corroborate such a generalized subjective complaint. Given how little Lacher said about No. 20-1035 Page 5 any limitations he had while sitting, the ALJ cannot be faulted for not explicitly addressing this complaint. See Murphy v. Colvin, 759 F.3d 811 , 817 (7th Cir. 2014) (internal citations omitted). AFFIRMED

2020-01-17 22:01:44.320353+00

Trussbll

*554OPINION. Trussbll: The sole question at issue here is the value on March 1, 1913, of a lease paid in for stock of petitioner in 1912 and which had been acquired two years previously for $50,000 cash. The amount of petitioner’s stock at par issued for the lease in question has no weight in the ascertaining of its value, as all of petitioner’s stock was issued to the owners of the lease and in proportion to their interests therein. *555The record discloses that the lease in question, executed in 1896 for a term of 98 years, was purchased in 1910 by the organizers of petitioner for $50,000. At that time it had approximately 86 years to run and the conditions imposed upon the prior lessees as to expenditures for improvements had already been complied with. The only obligation on the lessee from the date of purchase by the partnership was to pay taxes and a ground rent of $1,500 per annum. The lease also reserved title in the lessee to the improvements on the property at the time of its expiration and provided for their purchase by the lessor. At the time of its purchase the value of the property was such, as shown by the proof, as to make possible a rental netting a fair return on an investment in excess of $50,000. At that time there was a very marked and definite increase in progress in property values in the immediate vicinity, making it possible to determine that a very substantial increase in rentals could shortly be obtained. The testimony in respect to the purchase of this lease by the partnership of Benj. M. Weil’s Sons Co. was that this partnership had long represented the Litt Estate in respect to its real estate in Milwaukee and in the final winding up of the estate had disposed of all other property with exception of the lease in question, and that the executors of the estate offered it to the partnership at $50,000 to close the estate. It is testified that it was recognized that the lease had a greater value than this but the executors wished to close the administration of the estate and were willing for that reason to sacrifice something, and, realizing that the lease was worth more than this figure, these agents were given the opportunity to take it over at that price to compensate them for services rendered it in disposing of other properties of the estate for which they had been able to obtain very handsome prices. Following the purchase of this lease property values increased rapidly in the immediate vicinity and the execution of long-term leases on such property became more frequent and such leases were often bought and sold and a recognized market for them existed. Numerous large building operations were either carried out, started, or determined upon and announced between that date and March 1, 1913. Other properties in the immediate neighborhood and less advantageously situated were leased for long terms for rentals enormously in excess of that received under the lease in question. Even in 1910 one such property, slightly smaller in size than the one here in question and only two doors away, rented under a lease for 25 years at a rental beginning at $5,000 and increasing during the term to $6,000 per annum. This latter property was an “ inside lot ” whereas petitioner’s was on the corner of the alley and for this reason had a substantially greater value. In 1912 a property in the adjoining block two feet wider than petitioner’s lot leased for 25 *556years at $7,000, increasing to $8,000, with a privilege of extension for five years more at $10,000 per year. During the period in question the customary and usual basis for rental reserved by an owner under a long-term lease of this character was 5 per cent on the value of the land, and an increase in such value in properties in this neighborhood was anticipated and provided for by increases in the stipulated rental at certain periods in the lease term. The testimony as to values is by three witnesses who had for many years dealt in property in this vicinity and who qualified amply as having an intimate and accurate knowledge of such properties and their values and the values of long-term leases thereon. Two of these men ascribed a value to this property at March 1, 1913, of $123,000 for the land and $12,000 for the building, and the third $140,000 for the land, and $22,000 for the building. For the year 1913 the property was assessed for taxation at $122,500 for land and $12,000 for the building. Two of those witnesses testified to a reasonable value for the lease of $105^000 on March 1, 1913, and the third to a value of $100,000. We have carefully considered this testimony and the bases explained by the witnesses for the opinions expressed as to values both for the property and for the lease and conclude that on March 1, 1913, the lease in question had a reasonable market value of $100,000. The deficiency should be redetermined in accord with the foregoing findings of fact and opinion. Judgment will be entered pursuant to Rule 60.

2020-01-17 22:01:44.357697+00

Steknhagen

OPINION. Steknhagen : After the denial by the Board of petitioner’s motion for judgment in Carnation Milk Products Co., 9 B. T. A. 95, the petitioner herein, being a Delaware corporation, filed a uew motion for judg;ment, because the legal effect of several more recent decisions of the Board was said to afford entirely new support for holding the deficiency to be barred by the statute of limitations and hence to justify a new motion on that ground. This motion was, at petitioner’s request, set down for hearing and no objection to the hearing *557or consideration of the new motion was made by respondent. At the hearing, respondent asked and was granted leave by the presiding member to file an amendment to his answer, making new allegations of fact affecting the limitation question. It was clear at this hearing that this amended answer laid the foundation for evidence and thus that the hearing would be, not one of argument on the motion, but rather one of trial upon the preliminary issue of limitation. With the express concurrence of counsel for both parties, a day certain was fixed for the trial of the issue of limitation and the receipt 'of “such evidence as the parties may want to introduce on this question.” Upon the day fixed the parties appeared and contented themselves to argue on the pleadings, the respondent relying on the allegations of his last amended answer as showing that the motion could not be granted in the absence of evidence as to the facts therein alleged. Despite the clear notice to him at the earlier hearing that evidence would at this time be received, he offered none, and gave no indication that he had any new evidence to support the allegations in addition to what the record already contained. Petitioner stood on the record made by the pleadings. Thus it was submitted and briefs were subsequently filed. In this situation we think it fair to treat the case as upon a completed record as to the statute of limitations, the facts being such as are admitted in the pleadings, and to determine upon such facta whether petitioner is free from liability because the tax liability of its transferor is now barred. The undisputed facts as they appear from the petition and answer, amended petition and answer thereto, and amended answer thereto are as follows: The petitioner is a corporation duly organized and existing under the laws of the State of Delaware, with principal office at Oconomowoc, Wisconsin, and is the successor to or transferee of the assets of the Carnation Milk Products Company, a corporation duly organized and formerly existing under the laws of the State of Maine. The taxes in controversy are income, excess profits and war profits taxes for the calendar year 1919. The notice of deficiency was mailed to the petitioner on November 11, 1926, and indicated on its face that the respondent, acting under section 280 of the Revenue Act of 1926, proposed for assessment against the petitioner an amount of $257,074.60, as petitioner’s liability as a transferee of the assets of the said Maine corporation, and further that the said amount of $257,074.60 constituted all of an outstanding deficiency for 1919 determined by the respondent against the Maine corporation. During 1919 the Carnation Milk Products Company purchased from outside parties for $45,000 mortgage notes of the Sparta Condensed Milk Company having a face value of $54,000. The Commissioner of Internal Revenue has asserted an exsess profits tax upon the petitioner of $946,165.05 for the year 1919. *558The Commissioner reduced the invested capital of the Carnation Milk Products Company and affiliated corporations for 1919 by the amount of the amortization deduction for 1918, to wit, $257,532.63. On March 13, 1920, the Carnation Milk Products Company filed a tentative return of income and profits taxes for the calendar year 1919, which tentative return was dated March 6, 1920. On May 15, 1920, the said Company filed its income and profils tax. return for said calendar year 1919. No assessment was made against said Company for additional taxes for 1919 prior to May 15, 1925. On October 19, 1925, petitioner delivered to respondent a paper signed by the petitioner, a copy of which is as follows: Income and Profits Tax Waiver For Taxable Years Ended Prior to January 1, 1922 October 5th, 1925. In pursuance of the provisions of existing Internal Revenue laws_ Carnation Milk Products Co._, a taxpayer of_, and the Commissioner of Internal Revenue hereby waive the time prescribed by law for making any assessment of the amount of income, excess-profits, or war-profits taxes due under any return made by or on behalf of said taxpayer for the year (or years)_ 1918, 1919, 1920 and 1921_ under existing revenue acts, or under prior revenue acts. This waiver of the timé for making any assessment as aforesaid shall remain in effect until December 31, 1926, and shall then expire except that if a notice of a deficiency in tax is sent to said taxpayer by registered mail before said date and (1) no appeal is filed therefrom with the United States Board of Tax Appeals then said date shall be extended sixty days, or (2) if an appeal is filed with said Board then said date shall be extended by the number of days between the date of mailing of said notice of deficiency and the date of final decision by said Board. Carnation Milk Products Co., Taxpayer. By- Commissioner. If this waiver is executed on behalf of a corporation, it must be signed by such officer or officers of the corporation as are empowered under the laws of the State in which the corporation is located to sign for the corporation, in addition to which, the seal, if any, of the corporation must be affixed. The petitioner, on or about March 1, 1926, filed a claim for refund in the amount of $935,258.40, which was rejected by respondent. The computation of invested capital by the Commissioner for the year 1919 is based upon a reduction of surplus by an amount of Federal tax liability with respect to prior years. In support of petitioner’s demand for judgment, it is shown that respondent has determined against petitioner, not a deficiency under section 274, but a liability under section 280 as a transferee in respect of a deficiency of a corporation of Maine; and it is argued that the deficiency of the Maine corporation for 1919 was outlawed on May 15, 1925, no consent to a later determination having been filed by it, and that the consent of October 5,1925, being that of petitioner and not of the Maine corporation, did not extend the period of the *559Maine corporation’s tax liability. The cases relied upon are Bamberg Cotton Mills Co., 8 B. T. A. 1236; Bisso Ferry Co., 8 B. T. A. 1104; Weis & Lesh Mfg. Co., 13 B. T. A. 144. It has been held by the Board, where section 280 was not involved, that a petition filed by one other than the recipient of a deficiency notice does not serve to institute a proceeding within the statutory jurisdiction of the Board, Bisso Ferry Co., supra; Bond, Inc., 12 B. T. A. 339; Weis & Lesh Mfg. Co., supra; American Arch Co., 13 B. T. A. 552; Sanborn Brothers, 14 B. T. A. 1059; Hirsch Distilling Co., 14 B. T. A. 1073. If therefore this proceeding had not arisen out of section 280 this petitioner would have no standing before this Board to contest the determination of a deficiency of its predecessor. In the light of those decisions, it is plain that there was no jurisdiction in the Bamberg Cotton Mills case and that if the jurisdictional question had been considered the proceeding must have been dismissed. There is, however, in the present case no question of jurisdiction. The petitioner, alleging itself to be a transferee and appending a notice of liability under section 280, proceeds, as in Cappellini, 14 B. T. A. 1269, for a redetermination of such liability. As such transferee it strives at this time to establish nonliability by showing that by virtue of the statute of limitations its predecessor and transferor, the “ taxpayer,” was not liable for the tax, Revenue Act of 1928, sec. 602. There could be no doubt that in a proceeding by the Maine corporation if the 5-year limitation period had expired without a statutory consent to extend it, judgment of no deficiency would enter. And the burden of proving consent to extend the period is upon respondent. Farmers Feed Co., 10 B. T. A. 1069; Bonwit Teller & Co., 10 B. T. A. 1300. Respondent has not alleged or proved that the “ taxpayer,” that is the Maine corporation, consented with respondent to a later determination of its tax. The only facts about any so-called consent or waiver appear from respondent’s admission of petitioner’s allegation that it, the petitioner, filed a consent signed by it, which on its face purported to extend the time for determining its own tax liability for 1919. For all that appears, petitioner was itself a responsible taxpayer in 1919 and was in 1925 consenting that its own limitation period for 1919 should be extended. There is nothing in the terms of the consent to justify the belief that, or even to support a doubt whether, petitioner was consenting to extend either the period of its predecessor or its own period as a transferee. It does not appear when the Maine corporation was discontinued or the petitioner organized; whether in 1919 or during any period they were contemporaneously in existence; or what were the terms, circiun-*560stances and legal nature of the admitted succession and transfer of assets. If, by reason of facts not in evidence, the consent of October 5, 1925, could be legally imputed to the Maine corporation and vivify the tax liability which seems otherwise to have perished, such facts have been neither alleged nor proven, and respondent, whose reasonable and established function it was to produce them, has failed. When in Farmers Feed Co., supra, the doctrine was laid down that respondent by reason of his superior and convenient power had the burden of going forward with the statutory exception, a substantial responsibility was imposed upon him to establish all the facts which justified him in overriding the statutory period of repose. This is not satisfied unless he shows that upon which he acted to be sufficiently effective to justify his reliance upon it. In this case, the return was filed May 15, 1920. Without more, the period expired May 15, 1925. To overcome this, respondent points to a document not signed by the taxpayer but by the petitioner and, except for the similarity of names, having no apparent effect upon the taxpayer, and urges that this proves that “ both the Commissioner and the taxpayer consent in writing to a later determination, assessment, and collection of the tax.” Revenue Act 1921, sec. 250(d); Revenue Act 1924, sec. 278. We are of opinion that it falls short of the mark. Since for reasons earlier set forth we must regard the case as containing all the evidence to be introduced upon the question of limitations, our judgment must be that the respondent’s right has lapsed and that there is no deficiency and hence no liability of petitioner. It should be added that in our opinion the denial of the earlier motion does not make the present issue res adjudieata, and we are also of opinion that the statement of petitioner’s counsel arguendo at the hearing on the previous motion does not operate as evidence to support respondent’s pleaded allegations, nor, if it were evidence, would it be sufficient to change the facts upon which the decision must be predicated. Reviewed by the Board. Judgment will Toe entered for the petitioner. TRAmmell and Milliken concur in the result.

2020-01-17 22:01:44.388745+00

Fossan

*564opinion. Van Fossan : We are satisfied from the evidence that a bona fide partnership was entered into between M. D. Olds and his three *565daughters on December 31, 1918, and that it functioned as such during the taxable years. The intention and agreement to form a partnership, the contribution by the several parties of capital or services, the agreement to share profits or losses, cardinal tests of a partnership relation, were all present in the instant situation. Counsel for the respondent suggests that the effect of the transaction was the creation of a trust. The Michigan court to which the written agreement was submitted declared the same to create a partnership, with Olds occupying a position of trustee as to the partnership. In view of the conclusion we have reached from the evidence it is unnecessary to decide whether or not this ruling is conclusive of the issue before us. Suffice it that we are of the same opinion as was the court as to the creation and existence of the partnership. Government counsel points emphatically to the fact that the three daughters were not able to withdraw their shares of the profits without restraint and that the father retained control over such withdrawals. From this he argues, untenably we believe, that the daughters did not possess a right to require a division of the profits. The right to demand a division of profits and the right to withdraw suchj profits are not synonymous. Nor is there anything inconsistent with the existence of partnership relationship in the provision that except for persona] needs the profits should remain in the business subject to the discretion delegated to one member. The right to demand an accounting was not forgone by the delegation of such management and control. Throughout the hearing and in his brief counsel for respondent has suggested either directly or by insinuation that improper motives lie back of the creation of the alleged partnership. He also would throw -doubt on the bona tides of the suit in the Michigan court to construe the partnership agreement. We find no basis or justification whatsoever for such suggestions. If the respondent believes the whole transaction was fraudulently conceived to evade tax, the law dictates the proper procedure for him to follow. If respondent has not sufficient faith in his apprehensions to formulate them into charges they should not be brought into the case by indirection. Neither do we find justification in the record for the imposition df the penalty for delay in filing of the return. That respondent is not urging this penalty may reasonably be inferred from his brief, wherein he elects to omit any argument in support thereof. The deficiency, if any, should be recomputed on the basis of the existing partnership relation, in accordance with this opinion and findings of fact. Reviewed by the Board. Judgment will be entered under Rule 50.

2020-01-17 22:01:44.201651+00

Phillips

*544OPINION. Phillips: The single question in dispute in this proceeding is whether the leases acquired by the petitioner on May 22, 1919, from Keen and Woolf may be included in invested capital at their fair market value on that date (sec. 326(a) (2), Revenue Act of 1918) or whether the transaction falls within the provisions of section 331 of the Revenue Act of 1918, which provides that in the case of the change of ownership of a trade or business or change of ownership of property, after March 3, 1917, if an interest or control in such trade or business or property of 50 per centum or more remains in the same persons or any of them, then such asset transferred or received from the previous owner shall, for the purposes of determining invested capital, be taken at the cost of acquisition to the previous owner. In the present case the propert}^ in question was transferred by the previous owners to the corporation in exchange for all of its common stock and 1,100 shares of its preferred stock. It seems obvious that this situation comes within section 331 unless the agreements made by the petitioner and by the individuals, Keen and Woolf, with Jester, on the same day, take the transaction out of that section. *545The substance of petitioner’s contention is stated in its brief as follows: Under the plan outlined in said contract of May 22, Keen and Woolf were at no time the beneficial owners of more than 16,500 shares of the common stock and 1,100 shares of the preferred stock, which was approximately 27% of the whole of the common and preferred stock authorized to be issued. This assumes to take the transaction out of .section 331 on the grounds: (1) That the authorized capital stock is to be considered rather than the • issued capital stock. (2) That the contracts vested beneficial ownership elsewhere than in the individuals to whom all the outstanding stock was issued. (3) That, the “interest or control” of the former owners did not exceed 27 per cent. No one of these seems to us correct. All of the issued stock was owned by Keen and Woolf. If, as the petitioner suggests, they held a part of it in trust, it would not affect the situation. If they were trustees for the petitioner, they still remained the sole owners of the only stock outstanding which was not owned by the petitioner. Certainly they did not hold it as trustee for Jester, whose rights were merely contractual. But if by any stretch of the imagination it could be said they were trustees for Jester, they still owned more than 50 per cent of the common stock and all the issued preferred stock. Only by treating the unissued preferred stock, which Jester had agreed to attempt to sell, as owned or controlled by persons other than the petitioner or Keen and Woolf, could it be said that these individuals did not have a 50 per cent interest in these leases. Section 331 has reference to the interest or control which exists at the time the stock is issued for property; not to the situation which may exist at some future time if the new company is successful in selling more of its stock. We must look to the situation on May 22, 1919; not to that which existed on December 3, 1919. At that time we find the entire ownership and control in Keen and Woolf. But even on December 3, 1919, after the contract with Jester had been fully completed, Keen and Woolf remained in control of more than 50 per cent of the property transferred to them. They owned more than 50 per cent of the common stock, the only stock having voting rights at that date. In speaking of the control which an individual may have in property which he has transferred to a corporation, Congress must have had in mind control of the property through control of the corporation. Such control is exercised by stockholders by means of their votes; this is the control which is legally recognized. Remaining in control of more than 50 per cent of the voting stock, Keen and Woolf controlled this property within *546the meaning of section 331 even after the agreements with Jester had been carried out. Decision will he entered for respondent.

2020-12-01 22:02:11.351834+00

https://ecf.cofc.uscourts.gov/cgi-bin/show_public_doc?2020cv0066-29-0

In the United States Court of Federal Claims No. 20-66C Filed: December 1, 2020 FOR PUBLICATION LARRY LANDGRAF, Keywords: Motion to Dismiss; Rule 12(b)(1); Jurisdiction; Plaintiff, Rule 12(b)(6); sua sponte; Failure to State a Claim; v. Breach; Wetlands Reserve Program; Contract Formation; UNITED STATES, Preliminary Wetlands Reserve Plan of Operations; Defendant. Promissory Estoppel Larry Landgraf, Tivoli, TX, pro se. Rafique O. Anderson, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, Washington, D.C., for the defendant. MEMORANDUM OPINION HERTLING, Judge The plaintiff, Larry Landgraf, alleges that the Natural Resources Conservation Service (“the Service” or “NRCS”) breached a contract for removal of noxious brush from his property. The defendant, the United States, moves to dismiss under Rule 12(b)(1) of the Rules of the Court of Federal Claims (“RCFC”) for lack of subject-matter jurisdiction. Because the plaintiff did not have a contract with the United States, the Court grants the defendant’s motion to dismiss. The Court sua sponte dismisses under RCFC 12(b)(6) for failure to state a claim upon which relief can be granted. I. BACKGROUND1 A. Program Framework: Wetlands Reserve Program Congress established the Wetlands Reserve Program (“WRP”) to restore and protect wetlands in the United States. Food Security Act of 1985, Pub. L. No. 99-198, Title XII, § 1237, 1 Because the defendant moves to dismiss under RCFC 12(b)(1), the facts as alleged in the plaintiff’s complaint are assumed to be true. This recitation of the facts does not therefore constitute findings of fact; rather, the Court provides a recitation of the facts as alleged by the  99 Stat. 1354 (1985), repealed by Agricultural Act of 2014, Pub. L. No. 113-79, § 2703(a), 128 Stat. 767 (2014). The WRP enabled the Service to purchase conservation easements from private landowners and share with the landowners the cost of restoring the easement properties for conservation, recreational, and wildlife purposes. The WRP Manual from December 2010 outlined the application and enrollment process relevant to this case. (See Def.’s Renewed Mot. to Dismiss, App. at 72-140.) Property owners interested in participating in the WRP had to apply to the NRCS. WRP Manual § 514.11(A). The Service then determined whether the landowner was eligible to participate and whether the property met certain criteria. Id. §§ 514.12 & 514.14. The NRCS State Conservationist, in consultation with the U.S. Fish and Wildlife Service and the State Technical Committee, ranked applications for enrollment as part of the Service’s onsite field-investigation process. Id. §§ 514.20-514.23. After a landowner expressed interest in the WRP, the Service conducted onsite visits of the property with the landowner as part of the application process. Following these onsite visits, the Service would begin developing a preliminary Wetlands Reserve Plan of Operations (“WRPO”), also known as the preliminary WRP Restoration Plan.2 Id. § 514.44(A)(1). The preliminary WRPO enabled the Service to provide to the landowner information to “[a]llow the landowner to understand the project’s anticipated scope and effect” and to “[a]llow NRCS to develop a reasonable cost estimate for ranking purposes.” Id. § 514.44(B)(2)(i). The information contained in the preliminary WRPO included “[a] clear objective and understanding about desired outcome of restoration activities” and a “[l]ist of planned conservation practices, measures and activities, estimated quantities, and estimated costs.” Id. § 514.22(B)(12)(i) & (iii). The landowner had to agree to the implementation of a WRPO to enroll in the WRP, but the NRCS could “review, revise, and supplement the WRPO, as needed, to ensure that program goals [were] fully and effectively achieved.” Id. §§ 514.40(D), 514.41(A)(1). Once the NRCS acquired an easement, the WRPO remained the operative document but “does not supersede or plaintiff. In considering a motion to dismiss under RCFC 12(b), the Court may also consider documents that are “‘integral’” to the plaintiff’s claim. See Dimare Fresh, Inc. v. United States, 808 F.3d 1301 , 1306 (Fed. Cir. 2015) (quoting 5B Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 1357 (3d ed. 2004)). The Court considers as integral to the plaintiff’s claims the alleged contract submitted by the plaintiff, and the easement deed and the Wetlands Reserve Program Manual, copies of which were provided by the defendant. 2 With no discernable difference, the Manual inconsistently and without explanation used the phrase “WRPO” to mean both “Wetlands Reserve Plan of Operations” and “Wetlands Restoration Plan of Operations.” Compare § 514.44 with § 514.51. The defendant asserts that the preliminary WRP Restoration Plan is also called the preliminary WRPO. The plaintiff does not challenge that characterization. Accordingly, the Court uses “preliminary WRPO” and “preliminary WRP Restoration Plan” interchangeably. 2 modify the rights acquired by NRCS under the terms of the warranty easement deed.” Id. § 514.40(B). When an application had been selected for funding, the Service would send the landowner an offer of enrollment letter. Id. § 514.31(C). The letter would “clearly indicate that the application ha[d] been selected for enrollment and that NRCS [wa]s making an offer to purchase the easement for the compensation amount indicated on the [form] provided with the letter.” Id. § 514.31(C)(iii). To accept the offer, the landowner was generally allowed 15 calendar days to sign and return the document. Id. B. Facts The plaintiff alleges that he and two of his neighbors conveyed conservation easements to the Service, and that he contracted with the Service for the removal of noxious brush from his property subject to the easement. (Pl.’s Compl. at 2.) In 2013, the plaintiff and the NRCS District Conservationist, Will Blackwell, signed a document titled “Preliminary WRP Restoration Plan.” (Pl.’s Resp. to Mot. to Dismiss at 6-8.) This document, referred to by the plaintiff as “Contract A,” is the alleged contract at issue in this case. The three-page document contains signed and dated signature blocks on the final page. (Id. at 8.) The plaintiff’s signature line is labeled “Certification of Participants.” (Id.) Both signatures are dated April 23, 2013. (Id.) A box below the title labeled “Objective” provides that “[r]estoration practices will be implemented with intent of restoring vertical heterogeneity to a native monoculture stand of gulf cordgrass, using prescribed fire and brush mgmt., resulting in increased diversity of habitat for the species of concern; Whooping Crane. (Grus Americana).” (Id. at 6.) The body of the document starts with the heading “Wildlife.” (Id.) Indented below this heading is a page-width box containing the bold, centered text “Tract: 564.” (Id.) Below that box, also indented from the “Wildlife” heading, appear seven sections, each titled with an activity or work (e.g., “Brush Management,” “Fence”). (Id. at 6-7.) Each section contains a description followed by a table showing a “Planned Amount” in acres or feet for field “1” along with a year and a month (all specify September). (Id.) Each table also contains blank spaces for an “Applied Amount” and a date. (Id.) The “Prescribed Burning” section specifically provides: Controlled burns will be conducted as needed to maintain vigor of grass cover, suppress the growth of undesirable species, remove any dead or decaying woody plants and/or remove excessive thatch buildup. Burns will be conducted according to an NRCS approved prescribed burning management plan. Contact the NRCS office for assistance and a prescribed burn plan. [The Texas Commission on Environmental Quality] will have to approve the Burn Plan as well since Smooth Gulf Cordgrass is in the burn unit. 3 (Id. at 7.) That section specifies a cost rate of $10.50 per acre, and the table indicates 163.16 acres planned for 2016. (Id.) In 2015, the plaintiff enrolled in the WRP and sold to the United States a perpetual easement of 163.16 acres of land in Tivoli, Texas. (Def.’s Renewed Mot. to Dismiss, App. at 1- 18.) The United States paid the plaintiff $285,530 for the easement. (Id. at 2.) The easement deed limits the rights reserved to the plaintiff: [T]he Grantor(s), hereby grants and conveys with general warranty of title to the UNITED STATES OF AMERICA and its assigns . . . in perpetuity, all rights, title and interest in the lands comprising the easement area described in Part I and appurtenant rights of access to the easement area, but reserving to the Landowner only those rights, title, and interest expressly enumerated in Part II. It is the intention of the Landowner to convey and relinquish any and all other property rights not so reserved. (Id.) Part II of the easement deed provides that the plaintiff reserved the right to title, quiet enjoyment, control of access, recreational uses, subsurface resources, and water uses and water rights. (Id. at 3-4.) Each reserved right is “[s]ubject to the rights, title, and interest conveyed by this easement deed to the United States, including the restoration, protection, management, maintenance, enhancement, and monitoring of the wetland and other natural values of the easement area . . . .” (Id. at 3.) Part V of the easement deed provides the rights of the United States. Those rights include the management activities on the land, access to the land, management of the easement, and enforcement of the easement. (Id. at 6.) The right to management activities includes “the right to enter the easement area to undertake, on a cost-share basis with the Landowner or other entity as determined by the United States, any activities to restore, protect, manage, maintain, enhance, and monitor the wetland and other natural values of the easement area.” (Id.) Part VI of the easement deed provides that “[a]ll rights in the easement area not reserved by the Landowner shall be deemed acquired by the United States.” (Id. at 7.) The plaintiff’s reserved rights are further limited under Part VI: Any ambiguities in this easement deed shall be construed in favor of the United States to effect the wetland and conservation purposes for which this easement deed is being acquired. The property rights of the United States acquired under this easement shall be unaffected by any subsequent amendments or repeal of the Wetlands Reserve Program. (Id.) 4  In May 2017, the Service directed a contractor to uproot noxious brush on the plaintiff’s neighbor’s property and leave it in place. (Pl.’s Compl. at 2.) In the succeeding months, the contractor complied. (Id.) In August 2017, Hurricane Harvey’s storm-surge washed uprooted brush from the neighbor’s easement property onto the plaintiff’s property. (Id. at 3.) The plaintiff alleges that this uprooted brush from his neighbor’s property rendered two-thirds of the plaintiff’s property impassable and useless pending removal of the brush. (Id. at 5.) C. Procedural History In 2018, the plaintiff sued the NRCS under the Federal Tort Claims Act (“FTCA”), 28 U.S.C. § 2674 , in the U.S. District Court for the Southern District of Texas. The district court dismissed his complaint for lack of subject-matter jurisdiction. Landgraf v. National [sic] Res. Conservation Serv., No. 18-CV-61, Memorandum and Order, Apr. 9, 2019 (S.D. Tex.). The plaintiff filed a second lawsuit under the FTCA against the United States in district court, alleging that the preliminary WRP Restoration Plan was a contract with the United States. The district court again dismissed this second complaint for lack of subject-matter jurisdiction. Landgraf v. United States, No. 19-CV-34, Memorandum and Order, Aug. 8, 2019 (S.D. Tex.). In 2020, the plaintiff filed a complaint in this Court for breach of contract. The plaintiff alleged that he had contracted with the Service, which promised under the contract to remove noxious brush from his property. (Pl.’s Compl. at 2.) The plaintiff further alleged that the Service breached that contract by leaving uprooted brush on the property. (Id. at 5.) He sought removal of the brush, dissolution of the Service’s easement, $250,000 in damages, and attorneys’ fees. (Id. at 5-6.) The defendant moved to dismiss for lack of subject-matter jurisdiction and failure to state a claim. In its initial motion to dismiss, the defendant did not challenge the existence of the alleged contract. In May 2020, the Court found, for the purposes of the defendant’s motion to dismiss, that the “Prescribed Burning” provision of the alleged contract provided a sufficient basis to infer reasonably that the Service had a contractual duty to remove brush from the plaintiff’s property. Landgraf v. United States, No. 20-66C, 2020 WL 2466138 at *4 (May 13, 2020). The impassable state of his property and the Service’s abandonment of its removal efforts provided a reasonable basis to infer a breach of contract, and the complaint therefore met the plausibility standard to state a claim upon which relief could be granted. Id. at *8. The Court denied the defendant’s motion to dismiss but limited discovery to the following issues: (1) whether the “Prescribed Burning” provision of the preliminary WRP Restoration Plan document created a contractual duty for the defendant to remove uprooted brush originating on his neighbor’s property from the plaintiff’s property; (2) whether the flooding that deposited the brush on the plaintiff’s property was foreseeable when the alleged contract was executed; and (3) other affirmative defenses that the defendant intends to assert in its answer to the complaint. Id. 5  The defendant now renews its motion to dismiss.3 In so moving, the defendant offers additional context for the alleged contract. II. JURISDICTION The defendant moves to dismiss pursuant to RCFC 12(b)(1) for lack of subject-matter jurisdiction because the preliminary WRPO was not a contract between the plaintiff and the United States. As a pro se plaintiff, the plaintiff’s pleadings are entitled to a more liberal construction than the Court would give to pleadings prepared by a lawyer. See Haines v. Kerner, 404 U.S. 519 (1972). Such a liberal construction does not, however, divest a pro se plaintiff of the responsibility of demonstrating that he has satisfied the jurisdictional requirements that limit the types of claims this court may entertain. See, e.g., Kelley v. Sec’y, U.S. Dep’t of Labor, 812 F.2d 1378 , 1380 (Fed. Cir. 1987); Hale v. United States, 143 Fed. Cl. 180 , 184 (2019). The Tucker Act, 28 U.S.C. § 1491 (a), vests this court with jurisdiction over claims that are founded on an express or implied contract with the United States. United States v. Navajo Nation, 556 U.S. 287 , 289-90 (2009). To establish jurisdiction, a plaintiff only must allege the existence of a contract with the government. Gould, Inc. v. United States, 67 F.3d 925 , 929 (Fed. Cir. 1995). If the plaintiff fails to establish the existence of the alleged contract, the Court must dismiss the complaint for failure to state a claim, rather than for lack of jurisdiction. Engage Learning, Inc. v. Salazar, 660 F.3d 1346 , 1354 (Fed. Cir. 2011). Plainly frivolous contract claims may be dismissed for lack of subject-matter jurisdiction, although “the Supreme Court has made clear that such jurisdictional dismissals for frivolousness must be ‘confin[ed]’ to cases ‘that are very plain.’” Lewis v. United States, 70 F.3d 597 , 603-04 (Fed. Cir. 1995) (quoting Hart v. B.F. Keith Vaudeville Exch., 262 U.S. 271 , 274 (1923)). The plaintiff’s contract claim is not plainly frivolous. As the Court already found in its May 2020 opinion denying the defendant’s initial motion to dismiss, the “Prescribed Burning” provision provides a sufficient basis on which reasonably to infer that the Service had a contractual duty to remove brush from the plaintiff’s property. Landgraf, 2020 WL 2466138 at *8. The plaintiff and the NRCS District Conservationist both signed the preliminary WRPO. In that document, the “Prescribed Burning” provision provided that the NRCS would conduct controlled burns “as needed to maintain [the] vigor of grass cover, suppress the growth of undesirable species, remove any dead or decaying woody plants and/or remove excessive thatch buildup.” (Pl.’s Resp. to Mot. to Dismiss at 7.) The plaintiff alleges that the preliminary WRPO is a contract, and that the defendant has a contractual duty under that contract to remove brush from his property. The plaintiff has made a non-frivolous allegation of the existence of a 3 Concurrently with its renewed motion to dismiss, the defendant moved to suspend discovery; the Court previously granted that motion, pending its resolution of the renewed motion to dismiss. 6 contract between himself and the defendant. That allegation is enough, on its face, to trigger the Tucker Act’s grant of jurisdiction. III. FAILURE TO STATE A CLAIM In its renewed motion to dismiss, the defendant has provided additional context for the preliminary WRPO, including the easement deed and the WRP Manual. Given that additional context, the Court reconsiders the sufficiency of the plaintiff’s claim. The Court cannot provide the relief the plaintiff seeks if he does not have a contract with the government. The plaintiff’s failure to establish the existence of the alleged contract on the merits, therefore, is grounds to dismiss for failure to state a claim. When it is clear from the pleadings that “no relief could be granted under any set of facts that could be proved consistent with the allegations,” a court may dismiss a claim sua sponte under RCFC 12(b)(6) for failure to state a claim upon which relief can be granted. Anaheim Gardens v. United States, 444 F.3d 1309 , 1315 (Fed. Cir. 2006). For a claim to avoid dismissal, it must be “‘plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662 , 678 (2009) (quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544 , 570 (2007)). To test a claim’s plausibility, the court sets aside the complaint’s legal conclusions and focuses on the facts alleged in the complaint, accepting them as true. See id.; Am. Bankers Ass'n v. United States, 932 F.3d 1375 , 1380 (Fed. Cir. 2019). If these facts, when accepted as true, allow the court reasonably to infer “that the defendant is liable for the misconduct alleged,” the claim is plausible. Iqbal, 556 U.S. at 678 . “Plausible” means more than “possible”; plausibility requires more than facts that are “‘merely consistent with’” a defendant’s liability. Id. (quoting Twombly, 550 U.S. at 557 ). The court “must presume that the facts are as alleged in the complaint, and make all reasonable inferences in favor of the plaintiff.” Cary v. United States, 552 F.3d 1373 , 1376 (Fed. Cir. 2009). A. Alleged Contract The plaintiff alleges that he entered into a contract with the Service for the removal of brush from his property. To prove the existence of that contract, he must demonstrate four elements: “(1) mutuality of intent to contract; (2) offer and acceptance; (3) consideration; and (4) a government representative having actual authority to bind the United States.” Hometown Fin., Inc. v. United States, 409 F.3d 1360 , 1364 (Fed. Cir. 2005). To form a contract, there must be “[a]n objective manifestation of voluntary, mutual assent.” American Fed. Bank, FSB v. United States, 58 Fed. Cl. 429 , 436 (2003) (citing Anderson v. United States, 344 F.3d 1343 , 1353 (Fed. Cir. 2003)). Such mutuality of assent requires the plaintiff to “show, by objective evidence, the existence of an offer and a reciprocal acceptance.” Anderson, 344 F.3d at 1353 . An offer is “‘the manifestation of willingness to enter into a bargain, so made as to justify another person in understanding that his assent to that bargain is invited and will conclude it.’” Id. (quoting Restatement (Second) of Contracts § 24 (1981)). The plaintiff argues that Will 7 Blackwell, the NRCS District Conservationist, visited the plaintiff multiple times and assured the plaintiff the firm price of $1,750.00 per acre upon entry into the program. The plaintiff’s claim, however, does not dispute those assurances; instead, the plaintiff is alleging a breach of the terms in the preliminary WRPO that he and Mr. Blackwell later signed. The defendant argues that the Service did not make an offer when it presented the plaintiff with the preliminary WRPO as part of the WRP application process. Rather, the defendant argues that the offer was to acquire the easement, and the preliminary WRPO was not part of that offer. The regulatory framework indicates that the Service did not intend to be bound by the terms of the preliminary WRPO. To enroll in the WRP, the landowner was required to apply. 7 C.F.R. § 1467.5 (a). As part of the application process, the landowner had to consent to the NRCS entering his property to conduct an assessment that led to the development of the preliminary WRPO. Id. § 1467.5(b). The preliminary WRPO provided the prospective parties to the easement with information that would “[a]llow the landowner to understand the project’s anticipated scope and effect” and would “[a]llow NRCS to develop a reasonable cost estimate for ranking purposes.” WRP Manual § 514.44(B)(2)(i). The information included “[a] clear objective and understanding about desired outcome of restoration activities” and a “[l]ist of planned conservation practices, measures and activities, estimated quantities, and estimated costs.” Id. § 514.22(B)(12)(i) & (iii). Ultimately, the landowner had to agree to the implementation of a WRPO to enroll in the WRP. Id. § 514.40(D); 7 C.F.R. § 1467.4 (a)(2). The WRPO, however, remains changeable. The regulation and the Manual provided specifically that the “NRCS will review, revise, and supplement the WRPO as needed throughout the duration of the enrollment to ensure that program goals are fully and effectively achieved.” 7 C.F.R. § 1467.12 (b); WRP Manual § 514.41(A)(1). Because the NRCS retained the ability to modify the WRPO at its own discretion, the NRCS could not have intended to be bound by the preliminary WRPO’s terms. The preliminary WRPO provided the plaintiff only with “the project’s anticipated scope and effect.” WRP Manual § 514.44(B)(2)(i) (emphasis added). Under the regulatory framework outlined above, the document the plaintiff refers to as “Contract A” that sets forth the activities the Service will undertake on the land on which it acquires the easement is simply a statement of the anticipated work to be carried out; it is not a firm offer, under the terms of the regulations and Manual. The preliminary WRPO is what it claims to be: a “preliminary” document outlining the planned activities of the NRCS. The Service did not make an offer to the plaintiff to be bound in perpetuity to carry out the conservation activities outlined on the preliminary WRPO because under the regulations it could not have made such an offer. Without an offer from the Service, the plaintiff is unable to show an acceptance. Acceptance is the “‘manifestation of assent to the terms thereof made by the offeree in a manner invited or required by the offer.’” Anderson, 344 F.3d at 1355 (quoting Restatement (Second) of Contracts § 50(1)). The Ninth Circuit has noted that the WRP statute, 16 U.S.C. § 3837 (a) (repealed 2014), and the corresponding regulation, 7 C.F.R. § 1467.4 (a), required the landowner to “agree to the implementation of a conservation plan. It d[id] not require that [the landowner] 8 assent to the terms of the particular conservation plan chosen.” Big Meadows Grazing Ass’n v. United States ex rel. Veneman, 344 F.3d 940 , 944 (9th Cir. 2003). The plaintiff here applied to participate in the WRP and agreed to the preliminary WRPO as part of the application process. Even if he intended to assent to the particular conservation plan, he could not have accepted an offer—the Service did not make one. In the absence of an offer and a reciprocal acceptance, the plaintiff has failed to establish the mutuality of intent to contract. The plaintiff also cannot show that there was consideration. As the Federal Circuit has held, “[c]onsideration generally requires bargained-for exchange . . . When the promisor may choose to perform based solely on whim, then the promise will not serve as consideration.” NSK Ltd. v. United States, 115 F.3d 965 , 975 (Fed. Cir. 1997) (citations omitted); see also Woll v. United States, 45 Fed. Cl. 475 , 478 (1999) (“Whenever one of the parties to an agreement can terminate without consequence, an enforceable contract does not exist.”). The only agreement between the plaintiff and the Service at the time the preliminary WRPO was signed was that the plaintiff would apply for the WRP, and that the Service would evaluate that application. Before the plaintiff and the Service executed the easement, the Service retained the right to deny the plaintiff’s application to participate in the WRP for any reason. 7 C.F.R. § 1467.7 (e). Because the Service could choose not to perform (i.e., evaluate the plaintiff’s application), there was no consideration. The Service could also have rejected the plaintiff’s application, in which case, again, the preliminary WRPO would have had no effect. Even after the plaintiff’s application was accepted and the parties agreed to the easement, the Service did not promise to perform the conservation activities specifically outlined in the preliminary WRPO. The Service was free under the regulations to modify at its full discretion the preliminary WRPO as needed to further the program’s goals. Id. § 1467.12(b); WRP Manual § 514.41(A)(1). The Service’s retained right to choose whether to perform negates the plaintiff’s ability to show any consideration in this case. In sum, the plaintiff has not established the existence of a contract with the government, other than the easement. The Court now reviews whether the easement deed incorporates the terms of the preliminary WRPO. B. Easement Deed The plaintiff did ultimately contract with the Service for a conservation easement on his property. (See Def.’s Renewed Mot. to Dismiss, App. at 1-18.) He argues that the Service’s alleged breach of the preliminary WRPO denied him his retained rights of quiet enjoyment and of recreational uses. The plaintiff has clarified that he “is not objecting to ‘maintenance of the easement property’ per se. [He] is objecting to the failure of the NRCS to deliver on their promises listed in [the preliminary WRPO.]” (Pl.’s Resp. to Renewed Mot. to Dismiss at 7 (quoting Def.’s Renewed Mot. to Dismiss at 8).) At issue is whether the preliminary WRPO provided the plaintiff the right to challenge the Service’s conservation activities after conveying the easement. 9  The plaintiff conveyed and relinquished to the United States “any and all other property rights not so reserved” by the easement deed. (Id. at 2.) The plaintiff, as he correctly asserts, reserved the right of quiet enjoyment and right of recreational uses. (Id. at 3.) Those rights, however, are “[s]ubject to the rights, title, and interest conveyed by this easement deed to the United States, including the restoration, protection, management, maintenance, enhancement, and monitoring of the wetland and other natural values of the easement area . . . .” (Id.) The WRP Manual provided that when the NRCS acquired an easement, the WRPO “does not supersede or modify the rights acquired by NRCS under the terms of the warranty easement deed.” WRP Manual § 514.40(B). In the easement deed, the United States acquired the right to carry out the “altering of grassland, woodland, wildlife habitat or other natural features by burning, digging, plowing, disking, cutting or otherwise destroying the vegetative cover.” (Def.’s Renewed Mot. to Dismiss, App. at 4.) The “Prescribed Burning” provision of the preliminary WRPO, at issue here, provided for the NRCS to conduct controlled burns “as needed to maintain vigor of grass cover, suppress the growth of undesirable species, remove any dead or decaying woody plants and/or remove excessive thatch buildup.” (Pl.’s Resp. to Mot. to Dismiss at 7.) The “Prescribed Burning” provision does not supersede or modify the right subsequently acquired by the United States in the easement deed for the identical activity, and the easement deed does not grant the plaintiff the right to challenge those activities. See Big Meadows, 344 F.3d at 943 n.4 (finding that the NRCS easement nowhere granted the landowner the power to veto a conservation plan of which it disapproved). The easement deed does not, by its terms, incorporate the provisions of the preliminary WRPO. There is no basis in the statute, regulations, or Manual, on which to infer the incorporation of the preliminary WRPO into the easement deed. Accordingly, the plaintiff is unable to show that the terms of the preliminary WRPO, which are, in any event, changeable at the Service’s sole discretion, are part of the easement deed. IV. PROMISSORY ESTOPPEL The pro se plaintiff’s complaint could be construed to include a claim arising under the theory of promissory estoppel. Promissory estoppel requires a “promise which the promisor should reasonably expect to induce action or forbearance on the part of the promisee or a third person and which does induce such action or forbearance . . . .” Restatement (Second) of Contracts § 90(1) (1981). The plaintiff alleges that “Mr. Blackwell lured [him] into the WRP program with false hopes, expectations, and promises with a worthless signature . . . .” (Pl.’s Resp. to Renewed Mot. to Dismiss at 5.) The plaintiff, in substance, alleges that he relied on the terms of the preliminary WRPO and Mr. Blackwell’s statements in entering the WRP program. He appears to allege that he is entitled to damages for harm caused by the defendant’s failure to abide by the promises made by Mr. Blackwell and included in the preliminary WRPO. If the Court were to construe the complaint as invoking a claim for promissory estoppel, that claim would be outside this Court’s limited jurisdiction under the Tucker Act. 10  This Court’s jurisdiction is limited to express or implied-in-fact contract claims.4 Hercules Inc. v. United States, 516 U.S. 417 , 423 (1996). This court has held that promissory estoppel “requires the court to find an implied-in-law contract, a claim for which the United States has not waived its sovereign immunity.”5 Steinberg v. United States, 90 Fed. Cl. 435 , 443 (2009). Accordingly, the Court does not have jurisdiction over claims arising from promissory estoppel. Id.; see also Carter v. United States, 98 Fed. Cl. 632 , 638-39 (2011) (“As with other forms of equitable relief, we have no jurisdiction over claims of promissory estoppel.”). Therefore, to the extent that the plaintiff’s claim can be construed as one relying on promissory estoppel, this Court does not have jurisdiction. V. CONCLUSION Because the plaintiff has failed to establish the existence of a binding contract with the United States for the removal of his brush, the Court cannot grant him the relief he seeks. Accordingly, the Court grants the defendant’s motion to dismiss and, sua sponte, dismisses the complaint under RCFC 12(b)(6) for failure to state a claim upon which relief can be granted.6 The Court will issue an order in accordance with this memorandum opinion. s/ Richard A. Hertling Richard A. Hertling Judge 4 An implied-in-fact contract is “founded upon a meeting of minds, which, although not embodied in an express contract, is inferred, as a fact, from conduct of the parties showing, in the light of the surrounding circumstances, their tacit understanding.” Baltimore & O.R. Co. v. United States, 261 U.S. 592 , 597 (1923). 5 An implied-in-law contract is “where, by fiction of law, a promise is imputed to perform a legal duty, as to repay money obtained by fraud or duress . . . .” Baltimore & O.R. Co., 261 U.S. at 597 . The Court finds apparent the similarity between the signature pages on the “Preliminary 6 WRP Restoration Plan” document (Pl.’s Resp. to Mot. to Dismiss at 8) and the “WRP Restoration Plan” document (Def.’s Renewed Mot. to Dismiss, App. at 21) provided by the defendant. The plaintiff claims that this apparent similarity constitutes fraud or forgery by the Service. The Court need not address this issue because the argument is not relevant to the plaintiff’s breach-of-contract claim. 11

2020-12-01 22:02:13.864154+00

https://ecf.cofc.uscourts.gov/cgi-bin/show_public_doc?2019cv0063-66-0

In the United States Court of Federal Claims No. 19-63C (E-Filed: December 1, 2020) ) ROBERTO HERNANDEZ, et al., ) ) Motion to Dismiss; RCFC 12(b)(6); Plaintiffs, ) Fair Labor Standards Act (FLSA), 29 ) U.S.C. §§ 201-19; Anti-Deficiency Act v. ) (ADA), 31 U.S.C. §§ 1341-42 ; ) Government Employees Fair THE UNITED STATES, ) Treatment Act of 2019 (GEFTA); Pub. ) L. No. 116-1, 133 Stat. 3 (2019). Defendant. ) ) William Clifton Alexander, Corpus Christi, TX, for plaintiff. Erin K. Murdock-Park, Trial Attorney, with whom were Joseph H. Hunt, Assistant Attorney General, Robert E. Kirschman, Jr., Director, Reginald T. Blades, Jr., Assistant Director, Commercial Litigation Branch, Civil Division, United States Department of Justice, Washington, DC, for defendant. Ann C. Motto, of counsel. OPINION AND ORDER CAMPBELL-SMITH, Judge. Plaintiffs in this putative collective action allege that the government, through several agencies, violated the Fair Labor Standards Act (FLSA), 29 U.S.C. §§ 201-19 , by failing to timely pay their earned overtime and regular wages during the partial government shutdown and lapse of appropriations that began on December 22, 2018. See ECF No. 1 at 1-2 (complaint). On May 3, 2019, defendant moved to dismiss the complaint for failure to state a claim on which relief may be granted, pursuant to Rule 12(b)(6) of the Rules of the United States Court of Federal Claims (RCFC), on the basis that the Anti-Deficiency Act (ADA), 31 U.S.C. §§ 1341-42 , prohibited the government from paying employees. See ECF No. 25. In analyzing defendant’s motion, the court has considered: (1) plaintiffs’ complaint, ECF No. 1; (2) defendant’s motion to dismiss, ECF No. 25; (3) plaintiffs’ response to defendant’s motion, ECF No. 28; (4) defendant’s reply in support of its motion, ECF No. 32; (5) defendant’s first supplemental brief in support of its motion, ECF No. 34; (6) plaintiffs’ response to defendant’s first supplemental brief, ECF No. 35; (7) defendant’s second supplemental brief in support of its motion, ECF No. 43; (8) plaintiffs’ response to defendant’s second supplemental brief, ECF No. 47; (9) defendant’s third supplemental brief in support of its motion, ECF No. 51; and (10) plaintiffs’ response to defendant’s third supplemental brief, ECF No. 52. The motion is now fully briefed and ripe for ruling. 1 The court has considered all of the arguments presented by the parties, and addresses the issues that are pertinent to the court’s ruling in this opinion. For the following reasons, defendant’s motion is DENIED. I. Background Beginning at 12:01 a.m. on December 22, 2018, the federal government partially shut down due to a lack of appropriations. See ECF No. 1 at 1. The named plaintiffs in this case were, at the time of the shutdown, employees of the United States Immigration and Customs Enforcement, within the Department of Homeland Security. See id. at 3 . In their complaint, plaintiffs allege that they are “excepted employees,” a term which refers to “‘employees who are funded through annual appropriations who are nonetheless excepted from the furlough because they are performing work that, by law, may continue to be performed during a lapse in appropriations.’” Id. at 1-2 (quoting the United States Office of Personnel Management Guidance for Government Furloughs, Section B.1, https://www.opm.gov/policy-data-oversight/pay-leave/furlough- guidance/guidance-for-shutdown-furloughs.pdf (Sept. 2015)). Plaintiffs also allege that, in addition to being excepted employees required to work during a shutdown, they were also “classified as [ ] FLSA non-exempt employee[s].” Id. at 3 . As a result of being categorized as non-exempt, excepted employees, plaintiffs were required to work during 1 Defendant moves for dismissal of plaintiffs’ complaint for only one reason—“for failure to state a claim upon which relief may be granted.” ECF No. 25 at 6. In one of its supplemental briefs, defendant suggests that a recent decision issued by the Supreme Court of the United States, Maine Community Health Options v. United States, 140 S. Ct. 1308 (2020), a case that does not involve FLSA claims, indicates that this court lacks jurisdiction to hear this case because the FLSA “contains its own provision for judicial review.” ECF No. 51 at 2. In the same brief, defendant acknowledges binding precedent from the United States Court of Appeals for the Federal Circuit to the contrary. See id. (citing Abbey v. United States, 745 F.3d 1363 (Fed. Cir. 2014)). The court will not review this entirely new basis for dismissal, which was made for the first time in defendant’s third supplemental brief, and which defendant acknowledges contradicts binding precedent. If defendant believes this court lacks jurisdiction to continue exercising its authority in this case, it may file a motion properly raising the issue. See Rule 12(h)(3) of the Rules of the United States Court of Federal Claims (RCFC) (“If the court determines at any time that it lacks subject-matter jurisdiction, the court must dismiss the action.”). 2 the shutdown, but were not paid minimum or overtime wages on their regularly scheduled paydays in violation of the FLSA. See id. at 4-5 . According to plaintiffs, defendant “conducted no analyses to determine whether its failure to pay [e]xcepted [e]mployees on their regularly scheduled payday complied with the FLSA.” Id. at 5 . In support of this allegation, plaintiffs cite this court’s decision in Martin v. United States, 130 Fed. Cl. 578 (2017), a case in which this court “has found that the federal government’s failure to timely pay similarly-situated plaintiffs violates the FLSA and that the government is liable for liquidated damages for committing such violations.” Id. at 5 . Plaintiffs now seek payment of “unpaid back wages due to [p]laintiffs, . . . civil penalties, and . . . liquidated damages equal in amount to the unpaid compensation found due to [p]lainitffs.” Id. at 10 . II. Legal Standards When considering a motion to dismiss brought under RCFC 12(b)(6), the court “must presume that the facts are as alleged in the complaint, and make all reasonable inferences in favor of the plaintiff.” Cary v. United States, 552 F.3d 1373 , 1376 (Fed. Cir. 2009) (citing Gould, Inc. v. United States, 935 F.2d 1271 , 1274 (Fed. Cir. 1991)). It is well-settled that a complaint should be dismissed under RCFC 12(b)(6) “when the facts asserted by the claimant do not entitle him to a legal remedy.” Lindsay v. United States, 295 F.3d 1252 , 1257 (Fed. Cir. 2002). “To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662 , 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544 , 570 (2007)). III. Analysis A. Relevant Statutes This case fundamentally concerns the intersection of two statutes, the ADA and the FLSA. The ADA states that “an officer or employee” of the federal government “may not . . . make or authorize an expenditure or obligation exceeding an amount available in an appropriation or fund for the expenditure or obligation.” 31 U.S.C. § 1341 (a)(1)(A). In addition, the ADA dictates that “[a]n officer or employee of the United States Government or of the District of Columbia government may not accept voluntary services for either government or employ personal services exceeding that authorized by law except for emergencies involving the safety of human life or the protection of property.” 31 U.S.C. § 1342 . In 2019, Congress amended the ADA, adding, in relevant part, the following: 3  [E]ach excepted employee who is required to perform work during a covered lapse in appropriations[2] shall be paid for such work, at the employee’s standard rate of pay, at the earliest date possible after the lapse in appropriations ends, regardless of scheduled pay dates, and subject to the enactment of appropriations Acts ending the lapse. 31 U.S.C. § 1341 (c)(2) (footnote added). The amendment is commonly referred to as the Government Employees Fair Treatment Act of 2019 (GEFTA), Pub. L. No. 116-1, 133 Stat. 3 (2019). The knowing or willful violation of the ADA is punishable by a fine of “not more than $5,000” or imprisonment “for not more than 2 years, or both.” 31 U.S.C. § 1350 . And federal employees who violate the ADA “shall be subject to appropriate administrative discipline including, when circumstances warrant, suspension from duty without pay or removal from office.” 31 U.S.C. § 1349 (a). Defendant separately has obligations to its employees pursuant to the FLSA, which governs minimum wage and overtime wage compensation for certain employees. 3 See 29 U.S.C. § 213 (identifying categories of exempt employees). The FLSA requires that the government “pay to each of [its] employees” a minimum wage. 29 U.S.C. § 206 (a). Pursuant to the FLSA, the government also must compensate employees for hours worked in excess of a forty-hour workweek “at a rate not less than one and one-half times the regular rate at which [they are] employed.” 29 U.S.C. § 207 (a)(1). Although the text of the statute does not specify the date on which wages must be paid, courts have held that employers are required to pay these wages on the employee’s next regularly scheduled payday. See Brooklyn Sav. Bank v. O’Neil, 324 U.S. 697 , 707 (1945); Biggs v. Wilson, 1 F.3d 1537 , 1540 (9th Cir. 1993). If an employer violates the FLSA’s pay provisions, the employer is “liable to the . . . employees affected in the amount of their unpaid minimum wages, or their unpaid overtime compensation, as the case may be.” 29 U.S.C. § 216 (b). The employer may also be liable “in an additional equal amount as liquidated damages,” id., unless “the employer shows to the satisfaction of the court that the act or omission . . . was in good faith, and that [the employer] had reasonable grounds for believing that his act or omission was not a violation of the [FLSA],” 29 U.S.C. § 260 . 2 The statute defines “covered lapse in appropriations” to mean “any lapse in appropriations that begins on or after December 22, 2018.” 31 U.S.C. § 1341 (c)(1)(A). 3 The FLSA initially applied only to the private sector when enacted in 1938, but was amended to cover public employees in 1974. See Fair Labor Standards Amendments of 1974, Pub. L. No. 93-259, 88 Stat. 55 (1974). 4  B. The Court’s Reasoning in Martin Applies In its motion to dismiss, defendant first argues that plaintiffs’ complaint should be dismissed for failure to state a claim because the agencies for which appropriations lapsed on December 22, 2018, were prohibited by the ADA from paying their employees—even excepted employees who were required to work. See ECF No. 25 at 12-14. This mandate, in defendant’s view, means that defendant cannot be held liable for violating its obligations under the FLSA. See id. Defendant argues: When Congress criminalized payments during an appropriations lapse, it plainly precluded payments on the schedule plaintiffs assert is required by the FLSA. Federal officials who comply with that criminal prohibition do not violate the FLSA, and Congress did not create a scheme under which compliance with the [ADA] would result in additional compensation as damages to federal employees. Id. at 13 . The court has previously ruled on the intersection of the ADA and the FLSA in the context of a lapse in appropriations. See Martin, 130 Fed. Cl. 578 . In Martin, plaintiffs were “current or former government employees who allege[d] that they were not timely compensated for work performed during the shutdown, in violation of the [FLSA].” Id. at 580 (citing 29 U.S.C. § 201 et seq.). The plaintiffs in Martin alleged the right to liquidated damages with regard to both the government’s failure to timely pay minimum wages and its failure to pay overtime wages. See id. In its motion for summary judgment, the government argued that “it should avoid liability under the FLSA for its failure to [pay plaintiffs on their regularly scheduled pay days during the shutdown] because it was barred from making such payments pursuant to the ADA.” See id. at 582 . The government summarized its argument in Martin as follows: The FLSA and the Anti-Deficiency Act appear to impose two conflicting obligations upon Federal agencies: the FLSA mandates that the agencies “shall pay to each of [its] employees” a minimum wage, 29 U.S.C. § 206 (a) (emphasis added), which has been interpreted by the courts to include a requirement that the minimum wage be paid on the employees’ next regularly scheduled pay day, see Brooklyn Savings Bank v. O’Neil, 324 U.S. 697 , 707 n.20 [ 65 S. Ct. 895 , 89 L. Ed. 1296 ] (1945); Biggs v. Wilson, 1 F.3d 1537 , 1540 (9th Cir. 1993), and the [ADA] mandates that “[a]n officer or employee of the United States Government . . . may not . . . make or authorize an expenditure . . . exceeding an amount available in an appropriation or fund for the expenditure . . . .” 31 U.S.C. § 1341 (A)(1)(A) (emphasis added). Thus, when Federal agencies are faced with a lapse in appropriations and 5  cannot pay excepted employees on their next regularly scheduled payday, the question arises of which statutory mandate controls. Id. at 582-83 (quoting defendant’s motion for summary judgment) (alterations in original). After reviewing applicable precedent and persuasive authority, the court concluded that “the issue is more complex than simply a choice between whether the FLSA or the ADA controls.” Id. at 583 . In the court’s view: the appropriate way to reconcile the [ADA and the FLSA] is not to cancel defendant’s obligation to pay its employees in accordance with the manner in which the FLSA is commonly applied. Rather, the court would require that defendant demonstrate a good faith belief, based on reasonable grounds, that its actions were appropriate. As such, the court will proceed to analyze this case under the construct of the FLSA, and evaluate the existence and operation of the ADA as part of determining whether defendant met the statutory requirements to avoid liability for liquidated damages. Id. at 584 . The court noted that plaintiffs’ claims survived a motion to dismiss because they had “alleged that defendant had failed to pay wages” on plaintiffs’ “next regularly scheduled payday.” Id. at 584 . On summary judgment, the court concluded that plaintiffs had proven this claim. See id. The court then concluded that the evidence supported an award of liquidated damages because the government failed to satisfy the court that it acted in good faith and on reasonable grounds when it failed to make the payments required under the FLSA. 4 See id. at 585-86 . Both parties acknowledge that the plaintiffs in Martin were “situated similarly to plaintiffs here.” ECF No. 25 at 13 (defendant’s motion to dismiss); see also ECF No. 1 at 5 (plaintiffs citing Martin in their complaint); ECF No. 28 at 14-15 (plaintiffs reviewing and favorably comparing the arguments made in Martin). In addition, plaintiffs here, like the plaintiffs in Martin, have alleged that “[u]pon information and belief, [d]efendant conducted no analyses to determine whether its failure to pay [e]xcepted [e]mployees on their regularly scheduled payday complied with the FLSA.” ECF No. 1 at 5. 4 In Martin, the defendant also argued that it should avoid liability for liquidated damages with regard to overtime wages due to its inability to calculate the correct amounts due. See Martin v. United States, 130 Fed. Cl. 578 , 586-87 (2017). This argument was based on a bulletin from the Department of Labor, and involves an issue that has not been raised in the present case. The absence of this argument, however, has no bearing on the application of the court’s reasoning in Martin with regard to the structure of the proper analysis in this case. 6  In its motion to dismiss, defendant does not dispute plaintiffs’ allegations that they were required to work during the shutdown, or that the plaintiffs were not paid during that time due to the lapse in appropriations. See ECF No. 25. Defendant characterizes the issue now before the court as “whether plaintiffs have stated a claim for liquidated damages under the [FLSA] notwithstanding the provisions of the [ADA].” Id. at 7 . In arguing its position, defendant reiterates the arguments advanced in Martin, but does not present any meaningful distinction between the posture of the Martin plaintiffs and the plaintiffs here. Instead, it acknowledges that “[t]his Court in Martin v. United States concluded that plaintiffs situated similarly to plaintiffs here could recover liquidated damages under the FLSA,” but states that it “respectfully disagree[s] with that holding.” Id. at 13 . Notwithstanding defendant’s disagreement, the court continues to believe that the framework it set out in Martin is appropriate and applies here. 5 As it did in Martin, “the court will proceed to analyze this case under the construct of the FLSA, and evaluate the existence and operation of the ADA as part of determining whether defendant met the statutory requirements to avoid liability for liquidated damages.” 6 Martin, 130 Fed. Cl. at 5 Defendant also argues that its obligations under the FLSA are limited by the ADA because “a congressional payment instruction to an agency must be read in light of the [ADA].” ECF No. 25 at 16. In support of this argument, defendant cites to Highland Falls-Fort Montgomery Cent. Sch. Dist. v. United States, 48 F.3d 1166 , 1171 (Fed. Cir. 1995). See id. In Highland-Falls, plaintiffs challenged the Department of Education’s (DOE) method for allocating funds under the Impact Aid Act. Highland-Falls, 48 F.3d at 1171 . The United States Court of Appeals for the Federal Circuit found, however, that the DOE’s “approach was consistent with statutory requirements.” Id. The case did not address FLSA claims, and found that the DOE’s approach “harmonized the requirements of the Impact Aid Act and the [ADA].” See id. In the court’s view, the Federal Circuit’s decision in Highland-Falls does not alter the analysis in this case. The United States District Court for the District of Columbia’s combined decision in National Treasury Employees Union v. Trump, Case No. 19-cv-50 and Hardy v. Trump, Case No. 19-cv-51, 444 F. Supp. 3d 108 (2020), discussed by defendant in one of its supplemental filings, see ECF No. 43, is likewise unhelpful. Although it involved facts that arose from the same 2018 lapse in appropriations, the decision focuses almost exclusively on an analysis of whether plaintiffs’ claims were moot, rather than on the operation of the ADA. 6 The parties both claim that the Supreme Court of the United States’ decision in Maine Community Health, 140 S. Ct. 1308 , supports their position in this case. See ECF No. 51, ECF No. 52. Maine Community Health does not address the FLSA, and only includes a limited discussion of the ADA. See Maine Cmty. Health, 140 S. Ct. at 1321-22. Accordingly, the decision does not dictate the outcome here. To the extent that the case informs the present discussion, however, it tends to support plaintiffs. In the opinion, the Supreme Court held that “the [ADA] confirms that Congress can create obligations without contemporaneous funding sources,” and concludes that “the plain terms of the [statute at issue] created an obligation neither contingent on nor limited by the availability of appropriations or other funds.” Id. at 1322, 1323. 7 584. The court will, of course, consider the GEFTA amendment to the ADA as part of its analysis. C. Waiver of Sovereign Immunity Before analyzing the sufficiency of plaintiffs’ allegations, the court must address defendant’s contention that plaintiffs’ claims are barred by the doctrine of sovereign immunity. In its motion to dismiss, defendant correctly notes that “‘[a] waiver of the Federal Government’s sovereign immunity must be unequivocally expressed in statutory text, and will not be implied.’” ECF No. 25 at 18 (quoting Lane v. Pena, 518 U.S. 187 , 192 (1996)). And that waiver “‘will be strictly construed, in terms of its scope, in favor of the sovereign.’” Id. at 19 (quoting Lane, 518 U.S. at 192 ). Defendant concedes that the FLSA includes a waiver of sovereign immunity, but argues that the claims made by plaintiffs in this case fall outside the scope of that waiver. See id.; see also King v. United States, 112 Fed. Cl. 396 , 399 (2013) (stating that “there is no question that sovereign immunity has been waived under the FLSA”). Defendant argues that the FLSA “does not require that employees be paid on their regularly scheduled pay date or make damages available when compensation is not received on a pay date.” ECF No. 25 at 19. As a result, defendant contends, the scope of the FLSA’s waiver of sovereign immunity does not extend to the category of claims alleging a FLSA violation because wages were not paid as scheduled, such as plaintiffs’ claims in this case. See id. at 19-21 . According to defendant, the GEFTA confirms its long-standing belief that the government’s payment obligations under the FLSA are abrogated by a lack of appropriations: The [GEFTA] provides that “each excepted employee who is required to perform work during a . . . lapse in appropriations shall be paid for such work, at the employee’s standard rate of pay, at the earliest date possible after the lapse in appropriations ends, regardless of scheduled pay dates.” Pub. L. No. 116-1, 133 Stat. 3 . Congress has thus spoken directly to the question of when compensation should be paid. There can be no basis for inferring that compensation made in accordance with that explicit directive subjects the United States to liquidated damages. Id. at 20-21 . Applied here, this conclusion suggests that the defendant can incur an obligation to pay plaintiffs pursuant to the normal operation of the FLSA even when funding is not available. 8  Defendant also asserts that the scope of its waiver of sovereign immunity for FLSA claims does not cover the claims asserted here. See ECF No. 32 at 14. It argues, without citation to any authority, that: a cause of action under the FLSA cannot per se accrue against the United States when federal agencies do not pay employees on their regularly scheduled paydays during a lapse in appropriations because a federal statute expressly provides for when and at what rate federal employees will be paid under those circumstances. Id. The court disagrees. The claims brought by plaintiffs in this case are straightforward FLSA minimum wage and overtime claims under the FLSA. See ECF No. 28 at 6, 12-14; see also ECF No. 1 at 7-10. Because the FLSA does not specify when such claims arise, courts have interpreted the statute to include a requirement that employers make appropriate wage payments on the employee’s next regularly scheduled payday. See Brooklyn Sav. Bank, 324 U.S. at 707 ; Biggs, 1 F.3d at 1540 . Contrary to defendant’s suggestion, the court is unpersuaded that this judicially-imposed timing requirement transforms ordinary FLSA claims into something analytically distinct, and beyond the scope of the statute’s waiver of sovereign immunity. Accordingly, the court finds that defendant has waived sovereign immunity as to plaintiffs’ claims, as it has with all FLSA claims, and the court will review the sufficiency of plaintiffs’ allegations as it would in any other FLSA case. D. Plaintiffs State a Claim for FLSA Violations As noted above, the FLSA requires that the government “pay to each of [its] employees” a minimum wage. 29 U.S.C. § 206 (a). Pursuant to the FLSA, the government also must compensate employees for hours worked in excess of a forty-hour workweek “at a rate not less than one and one-half times the regular rate at which [they are] employed.” 29 U.S.C. § 207 (a)(1). And although the text of the statute does not specify the date on which wages must be paid, courts have held that employers are required to pay these wages on the employee’s next regularly scheduled payday. See Brooklyn Sav. Bank, 324 U.S. at 707 ; Biggs, 1 F.3d at 1540 . In their complaint, plaintiffs allege that during the lapse in appropriations, they and all putative class members were classified as excepted employees who “perform[ed] work for [d]efendant without pay” on their regularly scheduled pay days. 7 ECF No. 1 at 7 Defendant argues that “[t]o the extent that plaintiffs (1) claim any FLSA violation for failing to pay FLSA minimum wages or overtime wages to FLSA-exempt employees, or (2) 9 4-6. Plaintiffs allege specific facts demonstrating how the allegations apply to the named plaintiffs. See id. Defendant does not contest any of these allegations, and in fact, concedes that “plaintiffs [were] employees of agencies affected by the lapse in appropriations,” and that “plaintiffs were paid at the earliest possible date after the lapse in appropriations ended.” ECF No. 25 at 12, 13. Defendant also admits that “[p]laintiffs are federal employees who performed excepted work during the most recent lapse in appropriations.” Id. at 15. In short, defendant does not claim that plaintiffs are not entitled to payment under the FLSA, but instead argues that it “fully complied with its statutory obligations to plaintiffs.” Id. at 16. The court finds that, presuming the facts as alleged in the complaint and drawing all reasonable inferences in their favor, plaintiffs have stated a claim for relief under the FLSA. See Cary, 552 F.3d at 1376 (citing Gould, 935 F.2d at 1274 ). E. Liquidated Damages Defendant insists that its failure to pay plaintiffs was a decision made in good faith, in light of the ADA. See ECF No. 32 at 14-15. It further urges the court to find that its good faith is so clear that the recovery of liquidated damages should be barred at this stage in the litigation. See id. at 14-18. But as the court held in Martin: welcome FLSA-exempt employees . . . to join their collective, those claims must be dismissed.” ECF No. 25 at 15 n.3. In support of this statement, defendant cites to Jones v. United States, 88 Fed. Cl. 789 (2009). See id. In Jones, the court stated: “The ‘precise question at issue’ is whether Section 111(d) of the [Aviation and Transportation Security Act] exempts [Transportation Security Administration (TSA)] from compliance with the FLSA when establishing overtime compensation for security screeners. Because we find that the plain language of Section 111(d) is unambiguous, we conclude that TSA need not comply with the FLSA.” 88 Fed. Cl. at 792 (emphasis added). This case is not binding precedent, and appears to be limited in application to security screeners. Plaintiffs note that defendant “does not appear to seek relief on these arguments at this time” and therefore plaintiffs choose to “not further respond to them except to state that granting any relief on these arguments would constitute an improper advisory opinion.” ECF No. 28 at 7 n.1. (citing Gen. Mills, Inc. v. United States, 123 Fed. Cl. 576 , 594 (2015)). In the complaint, plaintiffs do not allege that any putative class member is a TSA employee. See ECF No. 1 at 3. Because the court’s decision in Jones does not hold that all TSA employees are necessarily FLSA-exempt, and because neither plaintiffs nor defendant has alleged that any putative class member is a TSA employee, the court will not address this argument at this time. 10  [I]t would be inappropriate to determine, on motion to dismiss, whether the government had reasonable grounds and good faith. It may well be that the government can establish these defenses, but its opportunity to do so will come later on summary judgment or at trial. Moreover, even if the court were to decide that a liquidated damages award is warranted, additional factual determinations remain to be made as to which employees, if any, are entitled to recover, and damages, if any, to which those employees would be entitled. Martin v. United States, 117 Fed. Cl. 611 , 627 (2014). Accordingly, the court declines to rule at this time on the issue of whether defendant can establish a good faith defense against liability for liquidated damages in this case. IV. Conclusion Accordingly, for the foregoing reasons: (1) Defendant’s motion to dismiss, ECF No. 25, is DENIED; (2) On or before January 29, 2021, defendant is directed to FILE an answer or otherwise respond to plaintiffs’ complaint; and (3) On or before January 29, 2021, the parties are directed to CONFER and FILE a joint status report informing the court of their positions on the consolidation of this case with any other matters before the court. IT IS SO ORDERED. s/Patricia E. Campbell-Smith PATRICIA E. CAMPBELL-SMITH Judge 11

2020-12-01 22:02:16.773695+00

https://ecf.cofc.uscourts.gov/cgi-bin/show_public_doc?2020cv0275-64-0

In the United States Court of Federal Claims No. 20-275 Filed: December 1, 2020 (**Not for Publication**) EDDY JEAN PHILIPPEAUX, Plaintiff, v. THE UNITED STATES, Defendant. MEMORANDUM OPINION AND ORDER TAPP, Judge. In this military pay suit, pro se Plaintiff, Eddy Jean Philippeaux, a former United States Navy servicemember, Air Force Reservist, and Air National Guardsman, seeks alteration of his military records and other, miscellaneous injunctive and compensatory relief. Mr. Philippeaux suffered a minor head injury in 1977, to which he now attributes several current physical and mental conditions, as well as socioeconomic hardship. However, a military review board found that Mr. Philippeaux did not establish that he was unfit for service at the time of his honorable discharge from the Navy. This conclusion was bolstered by Mr. Philippeaux’s subsequent service in the Air Force Reserves, and later, the Air National Guard, which required a physical examination prior to enlistment. Mr. Philippeaux moves for judgment on the administrative record seeking entry of an order that sets aside that decision. The United States maintains that the decision of the military review board was correct. For the reasons explained below, the United States’ Cross-Motion for Judgment on the Administrative Record (ECF No. 61) is GRANTED, and Mr. Philippeaux’s Motion for Judgment on the Administrative Record (ECF No. 52) is DENIED. Because the Court finds the United States is entitled to judgment on the administrative record, it need not address Mr. Philippeaux’s Motion for Declaratory Judgment (ECF No. 11), Motion for Permanent Injunction (ECF No. 23), and Motion to Strike (ECF No. 25). Therefore, those motions are DENIED AS MOOT.  I. Background A. Mr. Philippeaux’s Military Service Mr. Philippeaux enlisted in the United States Navy in 1972. (AR1, 965). 1 He served as a Storekeeper and Procurement Clerk. On October 12, 1977, while onboard a frigate, the U.S.S. McCandless, Mr. Philippeaux sought medical attention for a minor laceration to his face sustained from “hitting a wall.” (AR268). He was treated with two sutures and returned to full duty. (Id.). The Navy honorably discharged Mr. Philippeaux on October 1, 1980, and assigned him a RE-1 reenlistment code indicating his fitness for reenlistment and retention in the Naval Reserves. (AR1, 3, 725, 1352). As part of his discharge, the Navy performed a physical examination of Mr. Philippeaux on September 16, 1980. (AR1, 1311–12, 1314). Mr. Philippeaux self-reported that he was “healthy” and “not [taking] any medication[.]” (AR1311). On this same form, Mr. Philippeaux indicated that he was not currently suffering, nor had he ever suffered, from a litany of medical conditions including head injury, unconsciousness, depression, dizziness, eye trouble, or amnesia. (Id.). The examining physician did not list any medical abnormalities. (AR1312–13). On October 2, 1980, the day following his discharge from the Navy, Mr. Philippeaux enlisted in the United States Air Force Reserves as a Staff Sergeant. (AR974–77). Just over three years later, in 1983, Mr. Philippeaux enlisted in the Air National Guard. (AR1). On November 19, 1983, Mr. Philippeaux presented for an enlistment physical examination. (AR1300). Again, he reported that he was not currently suffering, nor had he ever suffered, from a myriad of medical conditions including head injury, unconsciousness, depression, dizziness, eye trouble, or amnesia. (Id.). Mr. Philippeaux, again, self-reported that he was “presently in very good health” and “under no medications.” (Id.). After being medically cleared for enlistment, Mr. Philippeaux joined the Air National Guard for the District of Columbia. (AR978–80). The Air National Guard discharge Mr. Philippeaux for “unsatisfactory participation” on October 27, 1989. (AR2, 970, 978, 972). B. Records from the Department of Veterans Affairs, the Board for Veterans Appeals, and the United States Court of Appeals for Veterans Claims Seven years following his discharge from the Air National Guard, and nineteen years following his injury while onboard the U.S.S. McCandless, on July 12, 1996, Mr. Philippeaux presented to a Department of Veterans Affairs (“VA”) Outpatient Clinic where he was evaluated for mental disorders. (AR173–77). The examining physician recorded extensive notes about Mr. Philippeaux’s service, and evaluated his mental fitness, but made no mention of Mr. Philippeaux’s 1977 injury or a possible connection to his observed mental state. (Id.). The VA diagnosed Mr. Philippeaux with dysthymic depression and assessed his psychiatric incapacity as “moderate to severe.” (AR176). Much later, in 2017, the VA retroactively determined that Mr. Philippeaux was 70 percent disabled and unemployable effective February 27, 1995. (AR204). 1 The Court cites to the Administrative Record, (ECF No. 41), and the Supplement to the Administrative Record, (ECF No. 51), as “(AR_).” 2 On May 9, 2011, the VA upgraded that disability assessment to 100 percent, effective July 1, 2008. (AR2, 256). In December of 2009, Mr. Philippeaux filed an informal claim with the VA asserting entitlement to service connection for a traumatic brain injury (“TBI”). (AR12). The VA denied that claim in May of 2010. (Id.). Mr. Philippeaux appealed his claim to the Board for Veterans’ Appeals (“the Board”), which also denied his claim, finding that “the competent evidence of record, including 2010 neurological testing and a February 2015 VA examination report, did not establish a diagnosis of a TBI or residuals thereof.” (AR13). Mr. Philippeaux appealed this denial to the United States Court of Appeals for Veterans Claims. (Id.). The Veterans Claims Court set aside that denial and remanded Mr. Philippeaux’s case to the Board, finding “the Board did not address favorable material evidence[.]” (AR15); see also Philippeaux v. Wilkie, 814 F. App’x 603 (Fed. Cir. 2020). C. Military Corrections Boards Proceedings On March 26, 2018, Mr. Philippeaux applied for correction of his military records to reflect a disability discharge under 10 U.S.C. § 1201 . (AR168). The Board for the Correction of Naval Records (“BCNR”) evaluated his application and ultimately denied the request, finding that “the evidence submitted was insufficient to establish the existence of probable material error or injustice.” (AR165). The BCNR explained that “[t]here was no medical evidence that [Mr. Philippeaux] [was] diagnosed with a mental health condition or a Traumatic Brain Injury after [the] 1977 injury to [his] face[.]” (AR165–66). Notably, the BCNR also found that because Mr. Philippeaux received both a discharge physical examination from the Navy and an enlistment physical from the Air National Guard, there was “strong objective evidence” that Mr. Philippeaux was fit for active duty when he was discharged from the Navy, and thus, not entitled to a change in his records to reflect a qualifying disability discharge. (AR166). However, the BCNR failed to consider Mr. Philippeaux’s Air Force service records from October 2, 1980, until his enlistment in the Air National Guard in 1983, and incorrectly found that period to be a break in service. (See AR164). On October 29, 2019, Mr. Philippeaux petitioned the BCNR for reconsideration of its decision. (AR5, 35). However, on reconsideration, the BCNR found that Mr. Philippeaux had failed to submit “new and material evidence” necessary to overturn the decision of the BCNR. (AR6). D. Court of Federal Claims Proceedings On March 6, 2020, Mr. Philippeaux filed a Complaint in this Court alleging he suffered a TBI connected to the injuries he sustained in 1977. (Compl., ECF No. 1). Mr. Philippeaux alleges that this injury occurred during his naval service and resulted in numerous medical complications and other harms. (See generally, Compl.). Notably, Mr. Philippeaux contends he “did not receive the standard, proper and appropriate care” following his head injury, that the Navy improperly discharged him from service without a permanent disability designation, and that the BCNR’s denial of his application to change the character of his discharge was arbitrary, capricious, and contrary to law. (Compl. at 2–3, 16). Mr. Philippeaux’s Complaint contains an 3 extended discussion of his alleged medical conditions, all of which, he alleges, are connected to his service in one way or another. Helpfully, Mr. Philippeaux distills his grievances into two counts. Count I alleges that the Navy “provided Mr. Philippeaux an erroneous character of discharge which has left him with the inability to earn a living while he is not receiving disability payments” and the United States “has failed to pay [him] the pay and allowances that he is entitled to receive” under 10 U.S.C. § 1201 . (Compl. at 27). Count II alleges that the United States’ actions “resulted in [Mr. Philippeaux] being deprived of property interests, pain and suffering, homelessness, loss of his mother, poverty to his children, aggravation of health, deprivation of social standing and [the] wrongful death of his mother due to homelessness[.]” (Compl. at 28). Mr. Philippeaux brings Count II under the Due Process and Equal Protection clauses of the Fifth Amendment to the United States Constitution. (Id.). On June 10, 2020, in light of the BCNR’s factually incorrect findings regarding Mr. Philippeaux’s service history, the Court remanded Mr. Philippeaux’s claims to the BCNR. (Remand Order, ECF No. 28). On remand, the Court directed the BCNR “to (1) reconsider whether [Mr.] Philippeaux is entitled to correction of his military records denied by the BCNR in its original decision dated October 1, 2018, taking into account the correct chronology of Mr. Philippeaux’s service history; and (2) consider any additional records submitted by Mr. Philippeaux.” (Id.). On June 29, 2020, the BCNR issued a second decision denying Mr. Philippeaux relief. (AR1–4). The BCNR determined that “no change to [Mr. Philippeaux’s] record was warranted” and he was “being appropriately compensated for [his] service connected disability conditions based on [his] 100% VA rating that entitles [him] to a significant tax-free monthly payment, free VA medical treatment, and other related disability benefits[.]” (AR4). In support of its decision, the BCNR cited Mr. Philippeaux’s discharge examination, his RE-1 discharge code specifying he was fit for reenlistment, his reenlistment in the Air Force Reserves, and his enlistment in the Air National Guard, which included a physical examination that determined Mr. Philippeaux was fit for service. (AR3–4). The BCNR concluded that Mr. Philippeaux’s post-discharge medical diagnoses and disability ratings were too far removed from his discharge to be probative of whether he was symptomatic or unfit for naval service at the time of his discharge on October 1, 1980. (AR3). The BCNR ultimately opined that “any changes in [Mr. Philippeaux’s] military record should be from [his] time after [his] Navy service since [he] allege[s] [his] disability symptoms later resulted in [his] ‘demotion’ and ‘involuntary discharge’ from the Air National Guard.” (AR4). On July 23, 2020, the United States filed notice of this BCNR decision. (ECF No. 35). Prior to setting a schedule for the parties to move for judgment on the administrative record, the Court requested Mr. Philippeaux’s consent to appoint pro bono counsel. (ECF No. 37). Mr. Philippeaux declined the Court’s invitation and elected to proceed pro se. (ECF No. 39). Thereafter, the parties filed cross-motions for judgment on the administrative record. (ECF Nos. 52, 61). Briefing is now complete and this matter stands submitted for decision. 4  II. Discussion A. Legal Standards i. Military Discharge Military retirement for disability is governed by 10 U.S.C. § 1201 , a money-mandating statute. Chambers v. United States, 417 F.3d 1218 , 1223 (Fed. Cir. 2005). Congress amended § 1201 after Mr. Philippeaux’s separation from the Navy. At the time of his discharge, § 1201 provided: Upon a determination by the Secretary concerned that a member of a regular component of the armed forces entitled to basic pay, or any other member of the armed forces . . . is unfit to perform the duties of his office, grade, rank, or rating because of physical disability incurred while entitled to basic pay, the Secretary may retire the member [for disability.] 10 U.S.C. § 1201 (1976). SECNAV Instruction 1850.4 spells out the personnel involved in the Secretary’s making of this determination of unfitness and disability: The Secretary of the Navy performs his statutory responsibility by means of the Department of the Navy Physical Disability Evaluation System. His principal agent in this regard is the Director, Naval Council of Personnel Boards. The Central Physical Evaluation Board, regional physical evaluation boards, Physical Review Council and Disability Evaluation System Counselors, together with other Navy and Marine commands and activities, comprise the Department of the Navy Disability Evaluation System. (DA1, ECF No. 61-1). 2 Thus, the Disability Evaluation System was “designated and directed to act on behalf of the Secretary of the Navy in making determinations as to fitness for active duty, . . . entitlement to disability benefits, and disposition of members properly referred for physical disability evaluation[.]” (DA2). Servicemembers were not referred for a disability evaluation unless their “fitness for continued active service [was] in question.” (DA7, 8). But not all physical defects “justify referring a case for disability evaluation.” (DA8). Referral was deemed appropriate “only when in the opinion of the medical board the defect materially interferes with the member’s ability to reasonably fulfill the purpose of [the member’s] employment on active duty.” (DA8). 2 Defendant’s Appendix is attached to the United States’ Cross-Motion for Judgment on the Administrative Record, (ECF No. 61). Helpfully, Defendant’s Appendix contains several former military regulations pertinent to Mr. Philippeaux at the time of his discharge from the Navy. For simplicity, rather than cite to each of these historical regulations, the Court cites to this appendix as “(DA_).” 5  Under SECNAVINST 1850.4, the Disability Evaluation System might deem a servicemember “unfit” if he was “unable to perform the duties of his office, grade, rank, or rating in such a manner as to reasonably fulfill the purpose of his employment on active duty.” (DA5). The mere presence of a disability did not mean a servicemember must have been found “unfit,” but rather the “nature and degree of the functional impairment produced by the disability” was compared with “the requirements of the duties to which the member may reasonably expect to be assigned[.]” (DA5). Congress has created several administrative boards to adjudicate claims brought by current and former military servicemembers. Under 10 U.S.C. § 1552 , Congress created administrative boards for the correction of military records. Congress created administrative boards “to review the discharge or dismissal” of a servicemember under 10 U.S.C. § 1553 . In 2014, then-Secretary of Defense Charles Hagel issued a memo (the “Hagel Memo”) providing supplemental guidance to the § 1552 corrections boards. (DA29–32). The Hagel Memo recognized that numerous Vietnam veterans had sought upgrade of their discharge characterizations 3 for Post-Traumatic Stress Disorder, which was not recognized at the time of service “and in many cases, diagnoses were not made until decades after service was complete.” (DA29). The result was that servicemembers’ records often “did not contain substantive information concerning medical condition in either Service treatment records or personnel records” and “[i]t has therefore been extremely difficult to document conditions that form a basis for mitigation in punitive, administrative, or other legal actions or to establish a nexus between PTSD and the misconduct underlying” other than honorable discharge conditions. (DA29). The memo attached medical guidance “intended to ease the application process for veterans who are seeking redress[.]” (DA29). The attached medical guidance advocated for “[l]iberal consideration [of] petitions for changes in characterization of service to Service treatment record entries which document one or more symptoms which meet the diagnostic criteria of [PTSD] or related conditions.” (DA31). In other words, where a servicemember’s discharge was characterized as “Other Than Honorable,” the military corrections boards were to give special consideration to symptoms that indicated PTSD and were to consider whether PTSD may have caused the misconduct related to that servicemember’s discharge. In 2017, then-Under Secretary of Defense Anthony Kurta issued a memo (the “Kurta Memo”) clarifying the Hagel Memo and expanding its scope to encompass § 1553 discharge and dismissal administrative boards. (See Mot. for Judicial Notice at 3, 6, ECF No. 42). 4 The Kurta 3 A servicemember’s discharge “characterization” relates to whether the servicemember was discharged for misconduct. A Navy servicemember’s discharge may be characterized as “Honorable,” “General,” or “Other Than Honorable.” Wisotsky v. United States, 69 Fed. Cl. 299 , 310 (2006). “When the [servicemember’s] separation is solely for reasons constituting substandard performance of duty . . . the characterization must be Honorable.” Id. (citing SECNAVINST 1920.6A, encl. 5, ¶ 1a, Guidelines on Characterization of Service (Nov. 21, 1983)). 4 On Motion from Mr. Philippeaux, the Court took judicial notice of the Kurta Memo. (ECF No. 51). 6 Memo specified that the guidance from the Hagel Memo was not limited to “Other Than Honorable” discharge characterizations, “but rather apply to any petition seeking discharge relief including requests to change the narrative reason, re-enlistment codes, and upgrades from General to Honorable characterizations.” (Id. at 6). Importantly, by their own terms, neither the Hagel Memo nor the Kurta Memo applied to the fitness for duty or disability determinations. ii. Judgment on the Administrative Record Where, as here, the parties have filed cross-motions for judgment on the administrative record, RCFC 52.1 provides a procedure for parties to seek the equivalent of an expedited trial on a “paper record, allowing fact-finding by the trial court.” Bannum, Inc. v. United States, 404 F.3d 1346 , 1356 (Fed. Cir. 2005). Unlike summary judgment standards, genuine issues of material fact do not preclude a judgment on the administrative record. See id. at 1355–56. Questions of fact are resolved by reference to the administrative record. Id. at 1356 . In challenging determinations of a military corrections board, a plaintiff must demonstrate “by cogent and clearly convincing evidence,” Wronke v. Marsh, 787 F.2d 1569 , 1576 (Fed. Cir. 1986), that the military board’s decision was “arbitrary, capricious, unsupported by substantial evidence, or contrary to law.” Metz v. United States, 466 F.3d 991 , 998 (Fed. Cir. 2006). It is well settled that “responsibility for determining who is fit or unfit to serve in the armed services is not a judicial province; and that courts cannot substitute their judgment for that of the military departments when reasonable minds could reach differing conclusions on the same evidence.” Heisig v. United States, 719 F.2d 1153 , 1156 (Fed. Cir. 1983) (citations omitted). Moreover, “military administrators are presumed to act lawfully and in good faith like other public officers, and the military is entitled to substantial deference in the governance of its affairs.” Dodson v. United States, 988 F.2d 1199 , 1204 (Fed. Cir. 1993). Even if a plaintiff identifies error in the administrative proceedings, the plaintiff still must “establish that the error was prejudicial, i.e., that it affected the Board’s ultimate conclusion[.]” Fisher v. United States, 81 Fed. Cl. 155 , 159 (2008), aff’d, No. 2008-5094, 2010 WL 4009437 (Fed. Cir. Oct. 14, 2010); see also Wagner v. United States, 365 F.3d 1358 , 1365 (Fed. Cir. 2004) (recognizing that although harmless error review is not appropriate in all cases, “[w]here reviewable standards or factors constrain the exercise of discretion, harmless error continues to be the appropriate test.”). A court may set aside an agency’s decision if the agency “entirely failed to consider an important aspect of the problem, offered an explanation for its decision that runs counter to the evidence before the agency, or the decision is so implausible that it could not be ascribed to a difference in view or the product of agency expertise.” Ala. Aircraft Indus., Inc. v. United States, 586 F.3d 1372 , 1375 (Fed. Cir. 2009) (quoting Motor Vehicle Mfrs. Ass’n v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29 , 43 (1983)). However, “[w]hen substantial evidence supports the board’s action, and when that action is reasonable in light of all the evidence presented, the court will not disturb the result.” Pope v. United States, 16 Cl. Ct. 637 , 641 (1989). The court’s review “does not require a reweighing of the evidence, but a determination whether the conclusion being reviewed is supported by substantial evidence.” Heisig, 719 F.2d at 1157 . iii. Motion to Dismiss The Court recognizes that pro se plaintiffs’ pleadings are generally held to “less stringent standards” than those of a professional lawyer. Haines v. Kerner, 404 U.S. 519 , 520–21 (1972). 7 However, the Court cannot extend this leniency to relieve Mr. Philippeaux of his jurisdictional burden. Kelley v. Sec’y, U.S. Dep’t of Labor, 812 F.2d 1378 , 1380 (Fed. Cir. 1987). Whether a court has jurisdiction is a threshold matter in every case. See Steel Co. v. Citizens for a Better Env’t, 523 U.S. 83 , 94–95 (1998). “If the Court determines at any time that it lacks subject- matter jurisdiction, the court must dismiss the action.” RCFC 12(h)(3). “The Court of Federal Claims is a court of limited jurisdiction.” Marcum LLP v. United States, 753 F.3d 1380 , 1382 (Fed. Cir. 2014). This Court resolves disputes over access to the federal government’s wallet. The Tucker Act is the primary statute conferring jurisdiction on this Court. The Tucker Act waives sovereign immunity for claims (1) founded on an express or implied contract with the United States; (2) seeking a refund for a payment made to the government; or (3) arising from federal constitutional, statutory, or regulatory law mandating payment of money damages by the United States government. Ontario Power Generation, Inc. v. United States, 369 F.3d 1298 , 1301 (Fed. Cir. 2004); see also United States v. Navajo Nation, 556 U.S. 287 (2009); United States v. Mitchell, 463 U.S. 206 (1983). Standing alone, however, the Tucker Act does not itself create a substantive right enforceable against the United States. Ferreiro v. United States, 501 F.3d 1349 , 1351 (Fed. Cir. 2007). To come within jurisdictional reach, “a plaintiff must identify a separate source of substantive law that creates the right to money damages.” Fisher v. United States, 402 F.3d 1167 , 1172 (Fed. Cir. 2005). B. The United States is Entitled to Judgment on the Administrative Record with Respect to Count I In Count I of his Complaint, Mr. Philippeaux raises allegations related to his discharge condition. (Compl. at 27). In his Motion for Judgment on the Administrative Record, Mr. Philippeaux seeks an order from this Court setting aside the second BCNR decision finding him not disabled while on active duty. (Pl.’s MJAR, ECF No. 52). Mr. Philippeaux supports his request by raising numerous allegations which he scatters throughout his Motion; the Court construes these allegations liberally. See Kerner, 404 U.S. 519 . First, he contends that the BCNR “failed to comply with the criteria set by DODI 1332.18 in determining whether or not [Mr. Philippeaux] was fit to reenlist.” (Id. at 20). Second, he alleges that he was “permanently disabled on active duty . . . because of his demonstrated endocrine and mental disorders[.]” (Id. at 2). Third, he highlights that the VA awarded him a 100 percent disability rating and declared him permanently disabled unemployable. (Id.). Fourth, Mr. Philippeaux asserts that his medical examination on discharge indicated he had cognitive and memory defects stemming from his 1977 head injury which should have entitled him to a disability discharge. (Id. at 18). Fifth, he argues that the Navy erred by failing to refer him for a Disability Evaluation System Board based on the Kurta Memo and his 1980 medical evaluation. (Id. at 2–3, 20). Sixth, Mr. Philippeaux summarily asserts that he met the criteria for disability retirement based on the Kurta Memo, but the BCNR nevertheless failed to heed that guidance. (Id. at 3, 19). In its Response, the United States contends that the first four arguments “attempt[] to have the Court impermissibly reweigh the evidence and substitute its judgment for that of the BCNR.” (Def.’s Mot. at 20, ECF No. 61). As to the fifth, the United States argues that “Mr. Philippeaux has not demonstrated that the Navy improperly failed to refer him to the [Disability Evaluation System], but in any event, the error was not prejudicial.” (Id. at 21). As to Mr. 8 Philippeaux’s sixth substantive argument, the United States responds that the Kurta Memo does not apply to Mr. Philippeaux’s case, but even if it did, the BCNR complied with it. (Id.). For the reasons that follow, the Court agrees with the United States and finds that the United States is entitled to judgment on the administrative record with respect to Count I. i. The BCNR Applied the Correct Standard to Determine Fitness for Service and the Court Cannot Reweigh the Evidence Presented to the BCNR As to the first of Mr. Philippeaux’s allegations the Court was able to identify—that the BCNR failed to comply with Department of Defense Directive (“DODI”) 1332.18 in reaching its decision on Mr. Philippeaux’s fitness to reenlist —Mr. Philippeaux is incorrect. DODI 1332.18 states that: The primary requisite for eligibility for retirement or separation under reference (a) is that the member must be unfit, because of physical disability, to perform the duties of his office, grade, rank or rating. (DA10). The BCNR relied on SECNAVINST 1850.4 (1977) in determining that “a service member is unfit due to a disability when the member is unable, because of the disease or injury, to perform the duties of their office, grade, rank or rating.” (AR2; DA5). The Secretary of the Navy issued SECNAVINST 1850.4 “[t]o define a system for the evaluation of physical disability and the directives and policies pertaining to it[.]” (DA1). “Physical evaluation determinations are made independently and are . . . controlled by regulations contained in the Disability Evaluation Manual (SECNAVINST 1850.4.).” Chayra v. United States, 23 Cl. Ct. 172 , 181 (1991) (quoting JAG Manual 0801d); see also McCray v. United States, 3 Cl. Ct. 253 , 256 (1983) (clarifying that “ 10 U.S.C. § 1216 (1976) directed the Secretary of the Navy to prescribe regulations relative to disability retirement determinations. Such regulations were issued by the Secretary of the Navy under the heading Disability Evaluation Manual, SECNAVINST 1850.4”). It is clear that the BCNR did not err in applying SECNAVINST 1850.4 to review Mr. Philippeaux’s fitness determination. But in any event, the standards are nearly identical. Thus, even if SECNAVINST 1850.4 were not the correct standard for making a disability determination, the error would be harmless because Mr. Philippeaux would not have been prejudiced by the mistake. See Sargisson v. United States, 913 F.2d 918 , 922–23 (Fed. Cir. 1990) (finding harmless error where there was no risk of prejudice to the serviceman due to the violation). The second, third, and fourth grounds for Mr. Philippeaux’s challenge to the BCNR decision would all require the Court to reweigh the evidence before the BCNR. In its decision dated June 29, 2020, the BCNR stated that it considered all the record evidence and determined that Mr. Philippeaux was fit for duty at the time of his discharge. (AR1–4). The BCNR considered the report of medical treatment following Mr. Philippeaux’s October 12, 1977 injury, his medical examination upon his discharge from the Navy, his discharge with a determination that he was fit for reenlistment, his enlistments with the Air Force Reserves and Air National Guard, his Air National Guard enlistment physical examination, his nine years of service in those branches after his discharge from the Navy, his VA records establishing and adjusting his disability ratings, and other evidence. (AR1–4). 9  In considering Mr. Philippeaux’s post-discharge diagnoses, the BCNR determined those diagnoses “were not probative on the issue of whether [Mr. Philippeaux] was symptomatic on 1 October 1980[,]” the date of his discharge from the Navy. (AR3). The BCNR concluded that the VA’s medical evaluation “was too distant in time from [Mr. Philippeaux’s] discharge date” and determined that “the results of the medical examination conducted contemporaneously with [his] discharge from the Navy was better evidence in determining [his] fitness for continued naval service at the time.” (AR3). The BCNR evaluated the form completed during that medical examination and noted that Mr. Philippeaux self-reported that he was “healthy” and “not [taking] any medication[.]” (AR1311). Furthermore, the BCNR noted that on that same form, Mr. Philippeaux indicated that he was not currently suffering, nor had he ever suffered, from a catalog of medical conditions including head injury, unconsciousness, depression, dizziness, eye trouble, or amnesia. (Id.). The examining physician did not list any medical abnormalities, contrary to Mr. Philippeaux’s assertions in his Complaint. (Compare AR1312–13 with Compl. (alleging a plethora of mental and physical disorders and conditions throughout)). Substantial evidence supports the BCNR’s conclusion and the Court declines Mr. Philippeaux’s invitation to supplant the BCNR’s judgment with its own. Mr. Philippeaux has offered nothing to rebut the presumption that military administrators act in good faith and are entitled to deference in determining who is fit or unfit to serve in the armed services. The BCNR determined that at the time of his discharge, Mr. Philippeaux’s records showed he was “not symptomatic for any disability conditions at the time of his discharge and that [his] performance issues were not disability related,” thus he was “more likely than not, fit for continued active duty on 1 October 1980 and, therefore, not eligible for assignment of physical disability as [his] narrative reason for separation from the Navy.” (AR4). In summary, the BCNR applied the correct standard to assess Mr. Philippeaux’s fitness at the time of his discharge, and reasonably concluded he was fit for service and therefore not entitled to a modification to his naval records. Mr. Philippeaux has not otherwise met his burden to demonstrate “by cogent and clearly convincing evidence that the [BCNR’s] decision was arbitrary, capricious or unlawful.” Dorl v. United States, 200 Ct. Cl. 626 , 633 (1973). Because “substantial evidence supports the [BCNR’s] action, and . . . that action is reasonable in light of all the evidence presented, the court will not disturb the result.” Pope v. United States, 16 Cl. Ct. 637 , 641 (1989). ii. The Navy Did Not Err in Failing to Refer Mr. Philippeaux to the Disability Evaluation System To the extent Mr. Philippeaux asserts the Navy erred by failing to refer him for a Disability Evaluation System Board, he is again incorrect. As the BCNR made clear, “[t]he purpose of the separation physical was to determine whether [Mr. Philippeaux] [was] physically qualified for discharge from active duty and whether any physical conditions existed that required a referral for treatment” or whether Mr. Philippeaux was “unable to perform [his] duties due to a disability condition” such that referral to the Disability Evaluation System was appropriate. (AR3). Referral to the Disability Evaluation System is only required if the servicemember is found to be unfit for service by a medical board. (DA7, 8). As discussed in detail above, there was no indication that Mr. Philippeaux was unfit for service at the time at the time of his separation physical conducted immediately prior to his discharge on October 1, 1980. 10 Therefore, the Navy did not err when it did not refer Mr. Philippeaux to the Disability Evaluation System. iii. The Kurta Memo is Not Applicable to Mr. Philippeaux’s Claims Mr. Philippeaux summarily asserts that he met the criteria for disability retirement based on the Kurta Memo, but the BCNR erroneously failed to heed that guidance in considering modification to his characterization of discharge. (Pl.’s MJAR at 3, 19). As explained above, the Kurta Memo was an expansion and clarification of the Hagel Memo. The purpose of the Hagel Memo was to give more weight to mitigating factors in evaluating a servicemember’s misconduct leading to an “Other than Honorable” or “General” discharge characterization. (DA29–32). Petitions for modification were to be construed liberally to take into account the effects of previously undiagnosed Post Traumatic Stress Disorders on servicemembers, and review boards were directed to acutely consider whether a servicemember’s PTSD motivated conduct that led to an other than honorable discharge. (DA31). Significantly, neither the Hagel Memo nor the Kurta Memo mention disability determinations. Mr. Philippeaux received an honorable discharge from the Navy. (AR725). Thus, there is no misconduct to mitigate and no service characterization to change. By its own terms, the Kurta Memo applies to petitions for changes in discharge characterizations, not to BCNR determinations with respect to disability benefits. (See Mot. for Judicial Notice at 3, 6). Therefore, the Kurta Memo has no application to the relief Mr. Philippeaux seeks and provides no legal basis to disturb the determinations and conclusions of the BCNR. C. Count II of Mr. Philippeaux’s Complaint Must Be Dismissed Under RCFC 12(b)(1) The United States moves for dismissal of Count II under RCFC 12(b)(1). (Def.’s Mot. at 15–18). Because Mr. Philippeaux’s Due Process and Equal Protection Clause claims are not money mandating, the Court lacks subject matter jurisdiction and the United States’ motion must be granted. A constitutional provision or statute is money mandating if it “can fairly be interpreted as mandating compensation by the Federal Government.” United States v. Navajo Nation, 556 U.S. at 290 (quoting United States v. Testan, 424 U.S. 392 , 400 (1976)). Mr. Philippeaux alleges violations of his constitutional rights to Due Process and Equal Protection under the Fifth Amendment to the United States Constitution. However, these constitutional provisions are not money-mandating. Leblanc v. United States, 50 F.3d 1025 , 1028 (Fed. Cir. 1995); Carruth v. United States, 627 F.2d 1068 , 1081 (Ct. Cl. 1980) (holding that the Court “has no jurisdiction over claims based upon the Due Process and Equal Protection guarantees of the Fifth Amendment, because these constitutional provisions do not obligate the Federal Government to pay money damages.”). Put simply, Count II does not present a dispute over monies owed by the United States Government. Where, as here, the Constitutional and statutory provisions relied upon by a plaintiff are not money-mandating, the Court of Federal Claims lacks jurisdiction and those claims must be dismissed for lack of subject matter jurisdiction. Jan’s Helicopter Serv., Inc. v. 11 Fed. Aviation Admin., 525 F.3d 1299 , 1308 (Fed. Cir. 2008) (citing Greenlee Cnty., Ariz. v. United States, 487 F.3d 871 , 876 (Fed. Cir. 2007)). III. Conclusion The BCNR’s decision that Mr. Philippeaux is not entitled to a modification of his naval records is not arbitrary, capricious, unsupported by evidence, or contrary to law. The BCNR considered all important aspects of Mr. Philippeaux’s claims, and its decision was both reasonable and supported by substantial evidence. Therefore, the United States is entitled to judgment on the administrative record with respect to Count I. The Court lacks subject matter jurisdiction to adjudicate the Fifth Amendment Due Process and Equal Protection claims Mr. Philippeaux brings under Count II, so those claims must be dismissed. In summary, the Court ORDERS the following: 1. The United States’ Cross-Motion for Judgment on the Administrative Record with respect to Count I, (ECF No. 61) is GRANTED. 2. The United States’ Motion to Dismiss Count II, (ECF No. 61), is GRANTED. 3. Mr. Philippeaux’s Motion for Judgment on the Administrative Record, (ECF No. 52) is DENIED. 4. Mr. Philippeaux’s Motion for Declaratory Judgment (ECF No. 11), Motion for Permanent Injunction (ECF No. 23), and Motion to Strike (ECF No. 25) are DENIED AS MOOT. 5. No costs or fees awarded. The Clerk is directed to enter judgment accordingly. IT IS SO ORDERED. David A. Tapp DAVID A. TAPP, Judge 12

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https://www.courts.ca.gov/opinions/nonpub/B300657.PDF

Filed 12/1/20 P. v. Williams CA2/4 NOT TO BE PUBLISHED IN THE 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 SECOND APPELLATE DISTRICT DIVISION FOUR THE PEOPLE, B300657 Plaintiff and Respondent, (Los Angeles County Super. Ct. No. BA476776) v. LONA WILLIAMS, Defendant and Appellant. APPEAL from a judgment of the Superior Court of Los Angeles County, Douglas W. Sortino, Judge. Affirmed. Tracy L. Emblem, under appointment by the Court of Appeal, for Defendant and Appellant. Xavier Becerra, Attorney General, Lance E. Winters, Chief Assistant Attorney General, Susan Sullivan Pithey, Assistant Attorney General, Steven D. Matthews and Analee J. Brodie, Deputy Attorneys General, for Plaintiff and Respondent.  Defendant and appellant Lona Williams cut a woman’s face with a broken glass pipe and stole $50 from her. A jury found defendant guilty of second degree robbery and assault with a deadly weapon, and found that she inflicted great bodily injury. The trial court denied defendant’s Romero1 motion and sentenced her to an aggregate term of 15 years. Defendant contends that the trial court erred by denying her request for a self-defense instruction on the assault count. She argues that the trial court further erred by denying her Romero motion and declining to stay her sentence for the assault pursuant to Penal Code section 654.2 We find no error and affirm. PROCEDURAL HISTORY An amended information filed June 17, 2019 charged defendant with second degree robbery (§ 211) and assault with a deadly weapon (§ 245, subd. (a)(1)), both serious felonies (§ 1192.7, subd. (c)). The amended information alleged that defendant personally inflicted great bodily injury upon the victim, Regina P., during the commission of both offenses. (§ 12202.7, subd. (a).) It further alleged that defendant previously suffered a conviction for criminal threats (§ 422) that was both a serious felony (§ 667, subd. (a)(1)) and a strike (§§ 667, subds. (b)-(j), 1170.12). A jury found defendant guilty of both offenses and found the enhancement allegations true. Defendant admitted her prior conviction, and the trial court found she had violated her probation. The trial court denied defendant’s Romero motion 1People v. Superior Court (Romero) (1996) 13 Cal.4th 497 . 2All further statutory references are to the Penal Code unless otherwise indicated. 2 (§ 1385). It sentenced her to a total prison term of 15 years in state prison: the high term of five years on the robbery count, doubled to 10 years due to her strike, plus a consecutive term of one year on the assault count (one-third the midterm), doubled to two years due to her strike, plus three years for the great bodily injury enhancement. The court imposed concurrent sentences for defendant’s probation violations, and exercised its discretion to stay the five-year enhancement under section 667, subdivision (a). Defendant timely appealed. FACTUAL BACKGROUND At trial, Regina P. testified to the following. On April 6, 2019, she was living in a tent on Los Angeles’s Skid Row. Defendant and her husband or partner lived in a tent down the street. Regina knew defendant and saw her around frequently, but did not consider her a friend. During the early morning hours of April 6, 2019, Regina walked to an ATM and withdrew four $50 bills. She put the money in her bra. On her way back to her tent, Regina stopped at a tent whose occupant sold various sundries to Skid Row residents. Using some of her cash, she purchased cigarettes and a shot of tequila. Regina also purchased a drink for defendant, who was at the “store” at the time. Regina put her change in her pants pocket and walked back to her tent. Defendant accompanied her. Regina went inside the tent, where she sat on a mattress with a man named “Nephew.” Defendant sat on a chair near the entryway. The trio talked, drank, and smoked crack cocaine. They were high and intoxicated. After about 45 minutes, defendant stood up “all of a sudden” and said, “I’m gonna take 3 your money.” Defendant had a “crazy,” “evil,” or “deviant” look on her face, and a broken, jagged-edged glass pipe in her fist, which she extended toward Regina. Regina told defendant, “Oh, no you’re not,” and “pulled her legs to get her to fall down.” Regina then climbed onto defendant to “try to hold her arms down from her getting me with that pipe.” Regina said she “had [her]arms down, pressed to [defendant’s] throat” at this point, but was not applying pressure: “I really was tryin’ to stop . . . her arms goin’ all over the place with that thing in her hand.” Regina also stated that she “tried to dig [defendant’s] eyes out with her fingers” and “whoop her ass,” “to stop her from stabbing me.” Regina, who was 5’7” and 100 pounds, was unable to overpower defendant, who was about 5’4” and “stocky.” Defendant stabbed Regina in the head with the pipe, Regina tried to protect herself with her hands, and the women rolled around the tent. While they were rolling around, defendant grabbed some of the money out of Regina’s bra. Defendant broke free and continued to stab and strike Regina. She also bit Regina’s face and said, “Oh, you’re gonna give me your money. Oh, yes, you are. Oh, yes you are.” Regina “couldn’t do nothing” to stop defendant. She tried to protect her head and face with her hands, which sustained “bad, deep cuts” between her fingers and around her knuckles. Regina also felt “wetness” and “leaking” on her face from the cuts defendant made there. She thought defendant “used something different” for one of the large cuts down the side of her face, and also to “slice all the way across my tent.” Regina was unsure, as she had moved in and out of consciousness during the altercation. 4  At some point, the altercation moved outside the tent. Regina recalled waking up about 15 feet away from her tent, and seeing police and emergency medical personnel nearby. She realized then that all of the money was missing from her bra, though she still had a few small bills in her pockets. Medical personnel treated Regina on the scene before transporting her to a hospital. At the hospital, Regina received “almost 20” stitches to her face. She also was interviewed by police; body-worn camera footage of the interview was played for the jury and admitted into evidence. The statements Regina made during the interview were consistent with her testimony. Regina’s neighbor and friend, William Buce, also testified about the events of April 6, 2019. He stated that he was awakened by Regina’s screams during the early morning hours. He left his tent and saw Regina outside her tent “on the sidewalk, laying on her back.” Defendant was “on top of her, on her knees, going crazy,” which Buce demonstrated by “clenching his left fist, bending his arm at the elbow, making a striking motion.” Defendant seemed angry and mad. Regina was bleeding from her face. Buce did not see a weapon in defendant’s hands. Shortly after Buce arrived on the scene, defendant’s husband “[r]eached out and grabbed her and pulled her away.” Defendant struggled against him, saying, “Let me at her.” When her husband released her, defendant “ran right back after” Regina. Defendant struck Regina and knocked her down. Regina fell onto the driveway of a nearby business, “and then she didn’t move after that.” Buce testified that “a crowd came around and broke it up.” Defendant left the scene and walked toward her tent. Buce saw money in defendant’s hand. 5  Regina, who was semi-conscious, told Buce that defendant had taken her money. Buce noticed that Regina had injuries “all around the knuckles and the top of her hands,” as well as “an inch from her juggler [sic] vein” in her neck. He testified that he never saw Regina attack, try to attack, or threaten defendant. Los Angeles Police Department officer Leslie Castro testified that she was dispatched to the scene of the altercation on April 6, 2019. She activated her body-worn camera when she arrived. Silent footage of Castro’s search of defendant was played for the jury and admitted into evidence. Castro recovered a $50 bill, a $1 bill, and a fully intact glass pipe from defendant’s person. Castro said she did not see any injuries on defendant, though on cross-examination she was impeached with testimony from the preliminary hearing, when she said she saw cuts on defendant’s eye and finger. She did not see any broken glass pipes at the scene. Castro interviewed Regina at the hospital later that day. She testified that Regina was bandaged but calm, and did not slur her words. Defendant did not testify or call any witnesses. DISCUSSION I. Self-Defense Instruction A. Background During the jury instructions conference, defense counsel requested an instruction on self-defense. She asserted that Regina’s testimony “that she was, at some point, on top of Ms. Williams; that she was holding her hands down; had her hands to Ms. Williams’ neck; that she was trying to dig Ms. Williams’ eyes out; trying to whoop Ms. Williams’ ass” could “lead to a logical inference that Ms. Williams may have acted in self-defense.” The 6 prosecutor responded that substantial evidence did not support a self-defense instruction. “[A]ccording to [Regina], [Regina] was the one defending herself after the defendant stood up, was brandishing that broken glass pipe and demanded her money. I don’t think . . . [Regina] is required to lay down and let herself get robbed.” The court denied the instruction. It explained that Regina’s testimony “was consistent that Ms. Williams was the aggressor from the beginning in this case; that she was an aggressor, utilizing deadly force; that she actually inflicted deadly force upon [Regina]; and, that [Regina], at all times, based on her account, was defending herself with force that seems to be reasonable under the circumstances. I just don’t see how there’s a reasonable inference that can be made from the testimony of [Regina] that this was in any way self-defense, based upon [Regina]’s account. [¶] This was an unprovoked attack that started as a robbery and wound up as assault with a deadly weapon; and frankly, the People may have a good argument for attempted murder, given the location of the wounds. They haven’t charged that, and I wouldn’t allow that at this point, but it appears to me they believe this to be an unprovoked attack. [Regina] did her best to defend, so I’m not gonna give that instruction.” B. Legal Principles The trial court is obligated to instruct on general principles of law relevant to the issues raised by the evidence, even in the absence of a request by the defendant. (People v. Brooks (2017) 3 Cal.5th 1 , 73.) This duty extends to instructions on defenses, if there is substantial evidence in support of the defense and it is not inconsistent with the defendant’s theory of the case. (Ibid.) 7 “In determining whether the evidence is sufficient to warrant a jury instruction, the trial court does not determine the credibility of the defense evidence, but only whether ‘there was evidence which, if believed by the jury, was sufficient to raise a reasonable doubt.’” (People v. Salas (2006) 37 Cal.4th 967 , 982.) The trial court does not have a duty to give instructions based solely on conjecture and speculation. (People v. Young (2005) 34 Cal.4th 1149 , 1200.) To justify an act of self-defense, the defendant must have an honest and reasonable belief that bodily injury is imminent. (People v. Minifie (1996) 13 Cal.4th 1055 , 1064.) The right of self- defense is limited to the use of force that itself is reasonable under the circumstances. (Ibid.) C. Analysis Defendant contends the trial court erred by failing to instruct the jury on self-defense. Acknowledging that she started the fight, she argues she was nevertheless entitled to an instruction on “imperfect self-defense,” because substantial evidence showed that Regina “escalated the altercation when she attacked appellant, causing appellant to fall to the ground.” We disagree. “Imperfect self-defense is the actual, but unreasonable, belief in the need to resort to self-defense to protect oneself from imminent peril.” (People v. Vasquez (2006) 136 Cal.App.4th 1176 , 1178.) We understand defendant to argue that she resorted to the self-defensive act of slashing Regina’s face with the glass pipe because she feared imminent danger when Regina knocked her to the ground or “initially possessed the jagged glass pipe.” This scenario is not supported by substantial evidence. The evidence showed that defendant initiated the altercation by brandishing a 8 broken pipe at Regina and demanding money from her. Defendant’s initiation of the attack did not foreclose self-defense; “imperfect self-defense is available ‘when the victim’s use of force against the defendant is unlawful, even when the defendant set in motion the chain of events that led the victim to attack the defendant.’ (Vasquez, supra, 136 Cal.App.4th at pp. 1179-1180.)” (People v. Ramirez (2015) 233 Cal.App.4th 940 , 947.) The problem here is that there is no evidence that Regina responded unlawfully. In response to a threat with a deadly weapon, Regina, who was unarmed, attempted to disarm defendant using only her own body. Defendant speculates that Regina must have had the broken pipe, because the pipe found during defendant’s arrest was intact. This is not a reasonable inference from the evidence presented. The primary authority on which defendant relies, People v. Lemus (1988) 203 Cal.App.3d 470 , is distinguishable. In Lemus, the prosecution presented evidence that the defendant mounted an unprovoked knife attack on the victim. The defendant testified that the victim verbally threatened him and struck him with his fists prior to the attack. (People v. Lemus, supra, 203 Cal.App.3d at pp. 473, 476.) The trial court refused to instruct the jury on self-defense, after apparently dismissing defendant’s testimony as incredible. (Id. at p. 477.) The Court of Appeal held that this was error: “[r]egardless of how incredible that evidence may have appeared, it was error for the trial court to determine unilaterally that the jury not be allowed to weigh and assess the credibility of [the defendant’s] testimony in the context of reasonable belief in the necessity to defend himself against [the victim].” (Id. at p. 478.) Here, in contrast, there was no evidence, credible or not, 9 that Regina threatened or attacked defendant prior to defendant’s initiation of the altercation. In her reply brief, defendant argues for the first time that Regina “had her arms pressed to appellant’s throat.” Even if this assertion had been properly presented in the opening brief, it too is unsupported by substantial evidence. Regina testified that she had her arms on defendant’s throat, but further stated that she was not applying pressure and was trying to stop defendant from stabbing her. There is no evidence that she attacked defendant, or that the force with which defendant responded—numerous slashes with a jagged piece of glass—was a reasonable response. The court did not err in denying the self-defense instruction. II. Romero Motion A. Background Prior to sentencing, defendant filed a Romero motion asking the court to strike her prior strike conviction, which stemmed from a 2010 incident in which defendant threatened to slit her neighbor’s throat with a kitchen knife because the woman owed her $10. Defendant argued that the criminal threats conviction was remote in time, she had a “very long history of struggling with substance abuse,” she had mental health issues, and was middle-aged. She asserted that “[a] grant of probation and a residential dual diagnosis treatment program would be ideal for [her] because it would address her mental health and drug issues and would also provide her with housing.” Defendant also provided the court with a handwritten letter, in which she disclosed childhood sexual abuse, additional abuse she endured while living in Skid Row, and diagnoses of bipolar disorder and post-traumatic stress disorder. 10  At the sentencing hearing, defendant reiterated the arguments raised in her motion. The prosecutor emphasized the similarity of the prior strike and current offenses, as well as defendant’s failure to remain conviction-free in the intervening period. The trial court denied the motion. The trial court stated it was “sympathetic to her mental health and drug issues,” as well as “her apparently troubled childhood.” However, the court also expressed concern about defendant’s “virtually unabated” criminal record dating from 1991. The court recognized that “most of her issues were non-violent,” and that her record initially was “not the most serious record.” It then summarized the escalation of defendant’s conduct: “Up until 1997, 1999, where she had her first - - what appears to be a crime of violence . . . a misdemeanor battery on a peace officer. And then it continued[,] ” with convictions for multiple grand thefts and drug offenses, criminal threats, and misdemeanor assault with a deadly weapon, for which she was on probation. The court stated that its “biggest concern” was the “incredibly violent” nature of defendant’s acts in the instant case. “It is slash wounds with a knife or a bladed object to her face and neck, and could have easily . . . been an attempted murder. . . . [Regina] could have easily wound up with her throat slashed and her dead. It could have been a murder. It was a very aggravated 245.” Before denying the motion, the court reiterated that it could not “disregard her lengthy criminal history, nor her extreme amount of violence she perpetrated on the victim in this case.” 11  B. Legal Principles When ruling on a Romero motion to strike a prior strike, the trial court must consider only factors “intrinsic to” the Three Strikes Law. (People v. Williams (1998) 17 Cal.4th 148 , 161.) These factors include “the nature and the circumstances of the defendant’s present felonies and prior serious and/or violent felony convictions, and the particulars of his [or her] background, character, and prospects.” (Ibid.) The court must then determine whether, in light of these factors, the defendant “may be deemed outside the scheme’s spirit, in whole or in part, and hence should be treated as though he [or she] had not previously been convicted of one or more serious and/or violent felonies.” (Ibid.) We review the trial court’s determination for an abuse of discretion. (People v. Carmony (2004) 33 Cal.4th 367 , 374.) We will find abuse of discretion only “in limited circumstances,” such as consideration of impermissible factors. (Ibid.) It is “‘not enough to show that reasonable people might disagree about whether to strike one or more’ prior conviction allegations.” (Id. at p. 378.) So long as the “‘record demonstrates that the trial court balanced the relevant facts and reached an impartial decision in conformity with the spirit of the law, we [will] affirm [its] ruling, even if we might have ruled differently in the first instance’ [citation].” (Ibid.) C. Analysis Defendant contends the trial court abused its discretion by relying on three “speculative and arbitrary reasons” to deny the motion. First, the trial court erroneously stated that she was convicted of battery on a peace officer. Second, it relied on the “unfounded fact” that she cut Regina with a “knife or bladed object,” when the evidence at trial showed that she used a glass 12 pipe. Third, the trial court improperly “believed that appellant should have been charged with attempted murder,” and “speculated on the non-existent outcome of the assault offense.” None of these contentions, individually or collectively, demonstrates an abuse of the court’s discretion. Defendant correctly states that she was not convicted of battery on a peace officer. According to the probation report in the appellate record, defendant was arrested for battery on a peace officer or other official personnel (§ 243, subd. (b)) in 1999. However, the report further states that she ultimately was convicted of misdemeanor vandalism (§ 594, subd. (a)) as a result of that incident. This factual error, which no one pointed out to the court, does not amount to an abuse of discretion. The trial court expressly and appropriately considered defendant’s entire criminal history, which included two other violent crimes, criminal threats (§ 422) and misdemeanor assault with a deadly weapon (§ 245, subd. (a)(1)), that were both closer in time to the instant offenses. The single misstatement—of one of the 19 entries in defendant’s criminal history—does not indicate reliance on improper factors. Indeed, the court’s ultimate conclusion that defendant’s criminal history was “lengthy, chronic, and continuous” is well-supported by the record. Defendant next asserts the court improperly relied on unfounded facts when it stated that defendant cut Regina “with a knife or bladed object.” She asserts this fact “finds no support in the record,” and contends the court improperly relied upon it when it found “the violence in this case to be highly aggravated; far beyond what was required for the robbery itself or for a 13 245(a)(1).”3 Defendant argues this reliance “on an improper fact that was critical to exercising sentencing discretion” was an abuse of discretion under People v. Cluff (2001) 87 Cal.App.4th 991 (Cluff). We disagree. Although a jagged shard of glass is neither a knife nor bladed object, we find no material difference here, where the point was that defendant used a dangerous weapon to slice Regina’s face. The cuts, which required approximately 20 stitches to mend, missed Regina’s jugular vein by an inch. The court reasonably concluded that Regina “could have easily wound up with her throat slashed and dead” during the struggle. The nature and circumstances of a defendant’s current offense are proper considerations on a Romero motion. Cluff is distinguishable. There, the current offense was not a violent felony, it was failure to register as a sex offender. (See Cluff, supra, 87 Cal.App.4th at p. 996.) The trial court denied Cluff’s Romero motion and sentenced him to 25 years to life. (See id. at p. 997.) In doing so, it rejected his contention that the failure to register was a “simple technical violation” of the statute and instead “[g]ave considerable weight” to Cluff’s four-month absence from the state and misstatements he made about his criminal history on a job application. (Id. at pp. 1000-1002.) The appellate court concluded this was an abuse of discretion because the trial court relied on “speculation, supposition, and guesswork” to infer that Cluff intended “to obfuscate his residence or escape the reach of law enforcement.” (Id. at p. 1003.) The appellate court found that neither Cluff’s extended visit in Utah—to help 3 The court made this remark in the context of determining whether to sentence defendant to the low, middle, or high term on the robbery count. 14 his recently widowed sister—nor his false statements on a job application provided a basis from which to conclude he intended to evade law enforcement, particularly when the record showed that he still lived at the address he previously registered and kept his appointments with law enforcement. (See id. at pp. 995, 1003.) It held that critical inferences must be supported by substantial evidence. (Id. at p. 997.) Here, the court’s imprecise recollection of the type of weapon used was not a “critical inference.” It also was not “speculation, supposition, [or] guesswork.” Regardless of the weapon, the undisputed facts showed that defendant caused significant injury to Regina’s face and neck region during the incident. The trial court properly considered the severity of the attack and Regina’s injuries when ruling on the motion. Defendant’s contention that the court impermissibly inferred—and relied on the inference—that Regina could have been killed in the attack fails for the same reason. The head is “an obviously vulnerable area” (People v. Saez (2015) 237 Cal.App.4th 1177 , 1189), and Buce testified that he saw cuts near Regina’s jugular vein. The court did not abuse its discretion by inferring that Regina could have been killed, nor by considering both the location and extent of her injuries in assessing the severity of the current offense. Defendant also suggests that the court did not appropriately consider mitigating factors, such as her mental health issues, substance abuse issues, and age. This suggestion is belied by the record. The court repeatedly acknowledged defendant’s personal struggles during the hearing, indicating that it gave them due consideration in its analysis. None of the cases defendant cites required the court to weigh the mitigating 15 and aggravating factors differently. (See People v. Garcia (1999) 20 Cal.4th 490 , 494; In re Nunez (2009) 173 Cal.App.4th 709 , 732; People v. Ruby (1988) 204 Cal.App.3d 462 .) III. Section 654 A. Background The trial court imposed a sentence of 10 years for the robbery, the base count. It then imposed an additional sentence of five years for the assault: one-third the midterm (one year), doubled to two years due to defendant’s strike, plus three years for the great bodily injury. In doing so, the court found that the assault “is a separate offense. The violence inherent in any robbery is far less than what is required for this 245(a)(1). My recollection of the facts as well is that the violence continued after the demand and the acquisition of the property was made. So it was a separate 245 that occurred after the robbery was at least complete, in terms of taking possession of the property.” B. Analysis Defendant argues that the court should have stayed the sentence on the assault count because the assault “occurred either simultaneously with the robbery or contemporaneously while the two women were engaged in a struggle on the ground.” We disagree. Section 654, subdivision (a), provides: “An act or omission that is punishable in different ways by different provisions of law shall be punished under the provision that provides for the longest potential term of imprisonment, but in no case shall the act or omission be punished under more than one provision.” Thus, if the robbery and assault constitute a single act, section 654 prohibits defendant from being punished for both. 16  “Whether a defendant may be subjected to multiple punishment under section 654 requires a two step-inquiry, because the statutory reference to an ‘act or omission’ may include not only a discrete physical act but also a course of conduct encompassing several acts punished with a single objective.” (People v. Corpening (2016) 2 Cal.5th 307 , 311.) “At step one, courts examine the facts of the case to determine whether multiple convictions are based upon a single physical act.” (Id. at p. 312.) If the answer is yes, then the defendant may not be punished more than once for that act. If the answer is no, we proceed to step two, in which we consider whether the defendant’s multiple acts, or course of conduct, “reflects a single ‘intent and objective’ or multiple intents and objectives.” (Id. at p. 311.) A course of conduct reflecting a single intent and objective may not be punished more than once; the same is true of a course of conduct that is “indivisible and the two crimes were committed so close in time that they were contemporaneous if not simultaneous.” (People v. Nuñez (2012) 210 Cal.App.4th 625 , 629.) “Whether multiple convictions are based upon a single act is determined by examining the facts of the case.” (People v. Mesa (2012) 54 Cal.4th 191 , 196.) Likewise, “[i]ntent and objective are factual questions for the trial court, which must find evidence to support the existence of a separate intent and objective for each sentenced offense.” (People v. Jackson (2016) 1 Cal.5th 269 , 354.) We review the court’s findings for substantial evidence. (People v. Brents (2012) 53 Cal.4th 599 , 618.) Substantial evidence supports the court’s findings here. Regina testified that defendant removed money from her bra while the women were struggling in the tent. After the theft, 17 defendant continued to accost Regina, inflicting serious injuries on her face and causing her to lose consciousness. When the amount of force used to achieve a robbery far exceeds that necessary, it may be considered evidence of a separate objective and intent. (People v. Cleveland (2001) 87 Cal.App.4th 263 , 272.) Moreover, Buce testified that defendant commenced a second attack on Regina after her husband interrupted the first attack. The court reasonably concluded from this evidence that the offenses were separate. DISPOSITION The judgment of the trial court is affirmed. NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS COLLINS, J. We concur: MANELLA, P. J. WILLHITE, J. 18

2020-12-01 22:02:56.868931+00

https://www.courts.ca.gov/opinions/nonpub/A158925.PDF

Filed 12/1/20 P. v. Trejo CA1/2 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 FIRST APPELLATE DISTRICT DIVISION TWO THE PEOPLE, Plaintiff and Respondent, A158925 v. ALBERT TREJO, (San Mateo County Super. Ct. No. SC081258) Defendant and Appellant. This appeal arises from a resentencing hearing in the trial court following a remand from this court in appellant’s prior appeal, directing the trial court to consider whether to exercise its new discretion, pursuant to amended Penal Code section 12022.53, subdivision (h),1 to strike or dismiss the firearm enhancement it had imposed under subdivision (d) of that section. (People v. Trejo (Dec. 12, 2018, A150790) [nonpub. opn.], review denied Feb. 27, 2019.) In this appeal, appellant contends that, notwithstanding our limited remand in the prior appeal, newly enacted Senate Bill No. 1393 gave the trial court the power to exercise its discretion to strike or dismiss appellant’s serious felony enhancement, previously imposed pursuant to section 667, subdivision (a), and the trial court should All further statutory references are to the Penal Code unless 1 otherwise indicated. 1 have considered whether to exercise that discretion at the resentencing hearing. Appellant further contends that because the trial court failed to recalculate his total custody credits at the resentencing hearing, it should be directed on remand to amend the abstract of judgment to include the custody credits from the time of his arrest through the date of his resentencing. Respondent concurs in both contentions. For the reasons discussed herein, we shall reverse and remand the matter for resentencing, to permit the court to exercise its discretion to strike or dismiss the serious felony enhancement. We will also direct the court to recalculate appellant’s custody credits to include all days he has been in custody since the date of his arrest. We shall otherwise affirm the judgment. PROCEDURAL BACKGROUND Appellant was originally charged by information with premeditated murder (§§ 187, subd. (a) & 189—count 1) and being an ex-felon in possession of a firearm (§ 29800, subd. (a)(1)—count 2). The information alleged, as to count 1, that appellant personally and intentionally discharged a firearm. (§ 12022.53, subd (d).) The information further alleged, as to count 2, that appellant had suffered seven prior convictions, including two serious felony convictions pursuant to 667, subdivision (a), and two strike convictions pursuant to section 1170.12, subd. (c)(2). On June 11, 2015, following a jury trial, the jury convicted appellant of first degree murder, finding true the allegation that he had personally and intentionally discharged a firearm, and also convicted him of being an ex- felon in possession of a firearm. Following a court trial, the court struck one of the serious felony allegations and one of the strike allegations, but found the five remaining allegations true. 2  On January 13, 2017, the court sentenced appellant to a total of 80 years to life in state prison. Appellant appealed the judgment, and on December 12, 2018, a panel of this Division reduced the first degree murder conviction to second degree murder and also remanded the matter to the trial court for resentencing, with directions to exercise its new discretion, pursuant to amended section 12022.53, subdivision (h), to determine whether to strike or dismiss the firearm enhancement imposed under subdivision (d) of that section. (People v. Trejo, supra, A150790.) On February 27, 2019, the California Supreme Court denied appellant’s petition for review (case No. S253665), and on March 25, 2019, the remittitur issued. At the November 1, 2019 resentencing hearing, the trial court declined to strike the section 12022.53 firearm enhancement and resentenced appellant to 60 years to life in prison. On November 12, 2019, appellant filed a notice of appeal.2 DISCUSSION I. Senate Bill No. 1393 Appellant contends the trial court should have considered whether to exercise its discretion to strike or dismiss the five-year enhancement for appellant’s prior serious felony conviction at the November 2019 resentencing hearing, in light of newly enacted Senate Bill No. 1393. Respondent agrees. 2 Because the facts underlying appellant’s convictions are not necessary to our resolution of the issues raised on appeal, we will not repeat them here. They are, however, set forth in our prior opinion. (See People v. Trejo, supra, A150790.) 3  A. Trial Court Background Appellant’s original sentence included imposition of a five-year term under section 667, subdivision (a) for the prior serious felony conviction enhancement. In this court’s December 12, 2018 opinion in this case, we remanded the matter to the trial court with directions to resentence appellant after considering its new discretion under amended section 12022.53, subdivision (h), to strike or dismiss the firearm enhancement. At the November 1, 2019 resentencing hearing on the firearm enhancement, after first arguing against the trial court exercising its new discretion to strike that enhancement, the prosecutor further argued that the court was not permitted to consider striking the serious felony enhancement because this court had limited the remand for resentencing to a determination of whether to dismiss or strike the firearm enhancement. The trial court declined to strike the firearm enhancement, and resentenced appellant to 60 years to life in prison, which included a term of 15 years to life for second degree murder, doubled based on the prior strike; a consecutive term of 25 years to life for the firearm enhancement, and a term of 5 years for the serious felony enhancement. The court did not address the question of whether it should exercise its discretion to strike or dismiss the serious felony enhancement. B. Legal Analysis “On September 30, 2018, the Governor signed Senate Bill No. 1393 which, effective January 1, 2019, amend[ed] sections 667(a) and 1385(b) to allow a court to exercise its discretion to strike or dismiss a prior serious felony conviction for sentencing purposes. (Stats. 2018, ch. 1013, §§ 1–2.)” (People v. Garcia (2018) 28 Cal.App.5th 961 , 971.) Recently, in People v. 4 Stamps (2020) 9 Cal.5th 685 , 693 (Stamps), our Supreme Court held that under In re Estrada (1965) 63 Cal.2d 740 , 745, Senate Bill No. 1393 applies retroactively to any defendant whose judgment is not yet final, reasoning that “[e]liminating the prior restriction on the court’s ability to strike a serious felony enhancement in furtherance of justice constitutes an ameliorative change within the meaning of Estrada.” (Stamps, at p. 699, citing People v. Superior Court (Lara) (2018) 4 Cal.5th 299 , 308–309.) In the present case, appellant’s judgment was not final on January 1, 2019, the effective date of Senate Bill No. 1393, and therefore, under Stamps, Senate Bill No. 1393 is applicable to him. Before we again remand the matter to the trial court for resentencing, we will address whether—as appellant asserts—the trial court should have considered its new discretion to strike the serious felony enhancement in the first instance at the prior resentencing hearing, even though our remand only directed the court to consider its new discretion under section 12022.53, subdivision (h) to strike or dismiss the firearm enhancement. Ordinarily, “ ‘[w]here a reviewing court reverses a judgment with directions . . . the trial court is bound by the directions given and has no authority to retry any other issue or to make any other findings. Its authority is limited wholly and solely to following the directions of the reviewing court.’ [Citations.]” (People v. Dutra (2006) 145 Cal.App.4th 1359 , 1367.) In People v. Hargis (2019) 33 Cal.App.5th 199 , 205 (Hargis), the Fifth District Court of Appeal addressed the scope of a trial court’s jurisdiction on remand for resentencing following an appeal, where a change in the law became effective after issuance of the appellate court’s opinion but before resentencing. The appellate court first found that the trial court did have the power on remand to consider the effect of the enactment of Proposition 57, 5 which had become effective before appellant’s convictions were final. (Hargis, at p. 207.) The court explained: “We do not believe our limited remand constituted a straightjacket for the trial court such that it had no power to hear a motion on an issue that could not have been raised on defendant’s prior appeal, and which concerned a change in the law that altered the court’s authority to adjudicate defendant’s case in criminal (adult) court in the first instance. [Citation.]” (Id. at pp. 207–208.) The court also found that “even if the trial court properly concluded it lacked jurisdiction to entertain the motion, the Proposition 57 issue has now been brought before us. The scope of our prior remand is no longer relevant to our analysis, as the law entitles defendant to a juvenile fitness/transfer hearing. [Citation.] We are bound by the law to afford him that hearing . . . .” (Hargis, at p. 208.) Here, as in Hargis, our prior remand could not have included directions related to Senate Bill No. 1393, since the law giving a trial court discretion to strike or dismiss a serious felony enhancement had not yet been enacted. By the time of the resentencing hearing, however, the law had been changed to allow such discretion, applicable to all defendants whose cases were not yet final. (See Stamps, supra, 9 Cal.5th at p. 699.) Consequently, the trial court had the power to exercise its discretion to strike or dismiss the serious felony enhancement, despite our limited remand. (See Hargis, supra, 33 Cal.App.5th at pp. 207–208.) Moreover, regardless of whether the trial court had jurisdiction to address this issue on the earlier remand, it “has now been brought before us” and “[t]he scope of our prior remand is no longer relevant to our analysis . . . .” (Id. at p. 208.) In conclusion, because the judgment in appellant’s case was not yet final when Senate Bill No. 1393 took effect, and because the record does not clearly indicate that the trial court would have declined to strike or dismiss 6 the five-year serious felony enhancement even if it knew it had the discretion to do so (see People v. Almanza (2018) 24 Cal.App.5th 1104 , 1110), he is entitled to a remand for resentencing, to give him the opportunity to seek relief under Senate Bill No. 1393. (See Stamps, supra, 9 Cal.5th at p. 707; People v. Garcia, supra, 28 Cal.App.5th at p. 971.) II. Recalculation of Appellant’s Custody Credits Appellant contends that because the trial court failed to recalculate his total custody credits at the resentencing hearing, the abstract of judgment must be amended to include the days he spent in custody between his arrest and his resentencing. Respondent agrees. At the November 1, 2019 resentencing hearing, the court did not recalculate the number of days appellant had spent in custody from the date of his arrest to the date of his resentencing, and did not include those custody credits in the amended abstract of judgment. “Where a defendant has served any portion of his sentence under a commitment based upon a judgment which judgment is subsequently declared invalid or which is modified during the term of imprisonment, such time shall be credited upon any subsequent sentence he may receive upon a new commitment for the same criminal act or acts.” (§ 2900.1; see People v. Buchalter (2001) 26 Cal.4th 20 , 37 [“the trial court, having modified defendant’s sentence on remand, was obliged, in its new abstract of judgment, to credit him with all actual days he had spent in custody, whether in jail or prison, up to that time”].) Appellant is plainly entitled to custody credits for all of the days he spent in custody between the date of his arrest and the date of his resentencing. Because we are remanding the case to the trial court for resentencing, we will also direct the court to recalculate the total number of 7 custody credits to which appellant is entitled, and to include those credits in an amended abstract of judgment. DISPOSITION The matter is remanded for resentencing, with directions to the trial court to (1) consider whether to exercise its discretion to strike or dismiss appellant’s five-year serious felony enhancement; (2) recalculate his custody credits, as set forth in this opinion; and (3) prepare an amended abstract of judgment reflecting the changes in appellant’s sentence, if any, and the additional custody credits to which he is entitled, and to forward a certified copy of the amended abstract of judgment to the Department of Corrections and Rehabilitation. In all other respects, the judgment is affirmed. 8  _________________________ Kline, P.J. We concur: _________________________ Richman, J. _________________________ Stewart, J. People v. Trejo (A158925) 9

2020-12-01 22:02:57.13131+00

https://www.courts.ca.gov/opinions/nonpub/C089289.PDF

Filed 12/1/20 P. v. Speer CA3 NOT TO BE PUBLISHED 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 THIRD APPELLATE DISTRICT (Butte) ---- THE PEOPLE, C089289 Plaintiff and Respondent, (Super. Ct. No. 17CF00867) v. ROBERT ALLEN SPEER, Defendant and Appellant. Following a court trial, defendant Robert Allen Speer was found guilty of first degree residential burglary. The court further found defendant had been convicted of two strike offenses that also qualified for prior serious felony conviction enhancements. While the court exercised its discretion to strike one of defendant’s strike enhancements, it declined to strike the other and the two prior serious felony conviction enhancements. As a result, defendant was sentenced to 22 years in prison. After “considering [defendant]’s length of term in the state prison and future prospects on ability to pay,” the court imposed various fines and fees. 1  On appeal, defendant contends there was insufficient evidence to support his conviction for first degree residential burglary because the evidence does not establish he entered the residence. He further contends the court erred during sentencing by declining to strike more than a single strike enhancement and by imposing fines and fees without first holding an ability-to-pay hearing. Finally, defendant argues his counsel was ineffective for failing to request a hearing under Penal Code1 section 1001.36. We disagree and affirm. FACTUAL AND PROCEDURAL BACKGROUND I The Burglary On February 24, 2017, Oroville Police Officer Marcus Tennigkeit responded to a call for service regarding two suspicious people in front of a home that had been evacuated during the Oroville spillway crisis. When he arrived, Officer Tennigkeit “didn’t observe anybody in the front of the residence” but “a gate to the right or west of the residence was open.” As Officer Tennigkeit walked toward the gate, he heard movement from inside the garage. Officer Tennigkeit then called and waited close to five minutes for a backup officer to arrive. During that time, Officer Tennigkeit did not see anybody go in or come out of the home; however, he could not see the back of the house. He further did not hear anybody attempt to leave the backyard, which was surrounded by shrubs and a fence. When Oroville Police Sergeant Stephen Solano arrived, the two officers walked to the backyard of the home and saw an open door, which led to the home’s attached garage. Sergeant Solano searched the home for potential intruders with a K-9 officer, and Officer Tennigkeit searched the backyard. During his search, Officer Tennigkeit found 1 Further section references are to the Penal Code unless otherwise indicated. 2 defendant crouching behind a large tree. Officer Tennigkeit ordered defendant out at gunpoint and arrested him. After putting defendant in a police car, two officers, along with the K-9 officer, again searched the home for potential intruders. In Officer Tennigkeit’s opinion, if anybody was hiding in the home, the K-9 officer “[m]ost likely” would have found him or her. No person was found inside of the home and every door, other than those in the garage, was secure. Further, footprints on the wet grass in the backyard led to defendant’s hiding spot and not to neighboring yards. The door leading from the garage to the main house had its glass removed and its screen damaged. Further, there were pry marks on the door jamb and door knob. The home had been “ransacked.” “Drawers were dumped out, a few items were tipped over, things were gone through not in an orderly fashion. Just things thrown about the residence.” Upon a search of defendant’s backpack, Officer Tennigkeit discovered a small “pry bar.” Also in the backpack and on defendant’s person were items from inside the home. Missing from the home, and never recovered, were a brand new television and lawn mower. Officer Tennigkeit also found methamphetamine on defendant.2 2 Defendant testified he was essentially homeless and, that the day before the incident, his backpack had been stolen with all of his and his girlfriend’s belongings in it. The day of the incident, defendant saw someone he thought was associated with the theft of his backpack and confronted that person. The person told defendant he would take defendant to the backpack, which led defendant to the backyard of the house where defendant was eventually arrested. Defendant testified that the person eventually fled the backyard, leaving defendant’s backpack behind with all of his belongings “strewn all the way around it.” It was dark and defendant put everything on the ground into his pockets without looking at what he was collecting. Defendant worked quickly because he heard movement from inside the house. When he heard someone come into the backyard, defendant hid where he was eventually discovered and arrested. 3  II Court Proceedings Before trial, defense counsel declared a doubt as to defendant’s competence. An expert evaluated defendant’s mental competence and filed a report with the trial court. Following a competency hearing, the trial court found defendant competent to stand trial. After a court trial, the court found defendant guilty of first degree residential burglary and found true two prior strike allegations and two prior serious felony conviction allegations. When finding defendant guilty, the court said “that [it] was not persuaded by [defendant]’s testimony and was persuaded by that of the officer and the other witnesses. The Court is mindful that in finding [defendant] guilty of the burglary, that does not impute to him all of the theft from the house that night. Rather the evidence shows, in the Court’s mind, in that it was found on and around [defendant] and they were items particularly identified as having been inside of the home that [defendant] did enter the home with the intent to steal and did steal items contained therein regardless of whether others also burglarized the home.” The court later exercised its discretion to strike one of defendant’s prior strike allegations -- a 1983 juvenile adjudication for voluntary manslaughter -- but declined to strike the remaining prior strike allegation and prior serious felony conviction allegations. Before ruling, the court reviewed the probation report. The probation report indicated defendant “was diagnosed with unknown mental health conditions when he was at the California Youth Authority. He has been in counselling off and on throughout his life, and he indicated his diagnoses have changed on numerous occasions.” The probation report further indicated defendant abused alcohol and methamphetamine from an early age. Starting from the ages of 10 and 11, respectively, defendant used as much methamphetamine and alcohol as he “could get [his] hands on.” He was a poor historian regarding his periods of sobriety, but defendant indicated his consumption of methamphetamine and alcohol had increased in 2016 after his mother was diagnosed with 4 lung cancer. Defendant also indicated he had abused Oxycontin for a short time after being prescribed the drug following an injury. Defendant admitted to the probation officer he ingested methamphetamine on the day of the burglary. While defendant acknowledged to the probation officer his mental health was evaluated as part of a competency hearing, he “denied suffering any deterioration of his mental health, explaining, ‘I just didn’t agree with my attorney.’ ” Defendant further attributed his current offenses and past parole and probation violations to his substance abuse. When deciding whether to strike defendant’s sentencing allegations, the court stated the standard it was to apply when determining whether to strike allegations in the interest of justice and then entered an analysis of the issue. It first considered the nature and circumstances of defendant’s present convictions and found defendant targeted a vulnerable victim, who was evacuated from the home, and took only personal items of no apparent market value. The court also considered defendant’s felony criminal record, which began in 1983 when he sustained his first strike conviction -- a juvenile adjudication for voluntary manslaughter with the use of a firearm. Defendant was housed with the California Youth Authority and eventually released from parole with no violations. Defendant, however, reoffended in 1990 when he was convicted of possession of stolen property. Defendant remained crime free until 1995 when he was convicted of battery. In 1996, he was again convicted of possession of stolen property, as well as failure to appear and another property offense. Defendant was convicted of his second strike offense in 1998 for oral copulation with a minor under 14 years of age. Defendant was released from prison in 2004, but violated parole in 2006 and 2007. Then in 2009, defendant was convicted of a Health and Safety Code violation that would be a misdemeanor but for defendant’s registration obligation under section 290. Defendant was also convicted of several misdemeanors throughout this time as well. 5  The court then considered defendant’s character and prospects. It noted defendant had remained free from crime for appreciable periods of time in his life. The court also noted that if it struck a prior strike allegation, defendant would serve a determinate term of 22 years in prison, which at his current age of 52, would result in him being released at an age when he is less likely to reoffend. Finally, the court considered whether the determinate sentence of 22 years was disproportionate to defendant’s conduct. The court thought it was not disproportionate because, although defendant was under the influence of drugs at the time he committed the burglary, the sentence was necessary to deter his recidivist behavior in light of defendant’s refusal to acknowledge responsibility in his current case. The court sentenced defendant to 22 years in prison -- six years for the first degree burglary conviction, doubled pursuant to the three strikes law, and 10 years for the two prior serious felony conviction allegations. The court then imposed fines and fees after “considering [defendant]’s length of term in the state prison and future prospects on ability to pay.” Defendant appeals. DISCUSSION I Sufficient Evidence Supports Defendant’s First Degree Residential Burglary Conviction Defendant argues there was insufficient evidence to support his conviction for first degree residential burglary. We disagree. “In assessing a claim of insufficiency of the evidence, the reviewing court’s task is to ‘review the whole record in the light most favorable to the judgment . . . to determine whether it discloses substantial evidence -- that is, evidence which is reasonable, credible, and of solid value -- such that a reasonable trier of fact could find the defendant guilty beyond a reasonable doubt.’ ” (People v. Ringo (2005) 134 Cal.App.4th 870 , 880.) 6 “ ‘The standard of review is the same in cases in which the People rely mainly on circumstantial evidence. [Citation.] “Although it is the duty of the [trier of fact] to acquit a defendant if it finds that circumstantial evidence is susceptible of two interpretations, one of which suggests guilt and the other innocence [citations], it is the [trier of fact], not the appellate court which must be convinced of the defendant’s guilt beyond a reasonable doubt.” ’ ” (People v. Snow (2003) 30 Cal.4th 43 , 66.) To establish the crime of burglary, the prosecution must prove an unlawful entry into a residence with the intent to commit a larceny or any felony. (§§ 459, 460, subd. (a); People v. Allen (1999) 21 Cal.4th 846 , 863, fn. 18.) The crime is complete upon entry into the defined structure with the larcenous intent, regardless of whether any theft takes place. (Allen, at p. 863, fn. 18; In re Matthew A. (2008) 165 Cal.App.4th 537 , 540 [“One may be liable for burglary upon entry with the requisite intent, regardless of whether the felony or theft actually committed is different from that originally contemplated, or whether any felony or theft actually is committed”].) The intent required to commit a burglary must be present at the time of entry. (People v. Sparks (2002) 28 Cal.4th 71 , 85, fn. 17.) For an entry to occur, the defendant must penetrate the building’s outer boundary. (Magness v. Superior Court (2012) 54 Cal.4th 270 , 273.) “[P]ossession of recently stolen property by itself is not sufficient to support a finding of guilt of any offense -- including theft-related offenses -- and, accordingly, there must be other corroborating evidence of the defendant’s guilt.” (People v. Moore (2011) 51 Cal.4th 1104 , 1130.) However, “[w]hen . . . a defendant is found in possession of property stolen in a burglary shortly after the burglary occurred, the corroborating evidence of the defendant’s acts, conduct, or declarations tending to show his guilt need only be slight to sustain the burglary convictions.” (People v. Mendoza (2000) 24 Cal.4th 130 , 176, superseded by statute on other grounds as stated in People v. Brooks (2017) 3 Cal.5th 1 , 63, fn. 8.) As corroborating evidence, the trier of fact may consider the time, place, and manner of the 7 defendant’s possession of stolen property, the defendant’s conduct, and any other evidence that tends to connect the defendant with the crime. (People v. Parson (2008) 44 Cal.4th 332 , 355.) Defendant acknowledges and minimizes corroborating evidence of his entry, such as his possession of items from the home and a pry bar similar to that used to enter the home. He also acknowledges and minimizes his proximity to the home and flight from police. Defendant argues this was all insufficient to convict him because the evidence established somebody else had taken items from the home and no testimony established the pry marks on the door matched the pry bar found in defendant’s possession. Defendant’s argument amounts to an argument we should believe his theory -- that someone else burglarized the home and left items in the backyard defendant collected while retrieving his backpack -- over the theory presented by the prosecution -- that defendant used the pry bar to enter the home and take the items later found in his possession. This issue of credibility was left to the trier of fact (People v. Zamudio (2008) 43 Cal.4th 327 , 357), who rejected defendant’s testimony. Indeed, the court stated that while someone else may have taken more expensive items from the home, defendant’s possession of inexpensive and personal items from the home convinced it defendant came into possession of those items after entering the home and that the items were not left behind by the previous intruder. Considering defendant’s possession of a pry bar, proximity to the home, and flight from police, sufficient evidence supports the burglary conviction. (See People v. Parson, supra, 44 Cal.4th at p. 355.) II The Trial Court Did Not Abuse Its Discretion By Declining To Strike One Of Defendant’s Prior Strike Allegations And His Two Prior Serious Felony Conviction Allegations Defendant argues the trial court abused its discretion by striking only one of his prior strike allegations because “a sentence of 22 years in state prison for the instant 8 offense, in light of [defendant’s] personal circumstances, the nature of the offense, and the nature of his criminal record is patently absurd and unjust.” We disagree. When a trial court exercises its discretion in responding to a request to strike an enhancement “in furtherance of justice,” we review for abuse of discretion. (§ 1385; People v. Superior Court (Alvarez) (1997) 14 Cal.4th 968 , 977; People v. Superior Court (Romero) (1996) 13 Cal.4th 497 , 531; People v. Ortega (2000) 84 Cal.App.4th 659 , 666.) The party attacking the sentence must “ ‘clearly show that the sentencing decision was irrational or arbitrary. [Citation.] In the absence of such a showing, the trial court is presumed to have acted to achieve legitimate sentencing objectives, and its discretionary determination to impose a particular sentence will not be set aside on review.’ ” (Alvarez, at pp. 977-978.) We will not reverse simply because reasonable people might disagree with the court’s decision. (Id. at p. 978.) Defendant argues the court ruled contrary to the spirit of Proposition 363 because it imposed punishment that was disproportionate to his crime, resulting in a long sentence and waste of taxpayer dollars. Defendant points to the trial court’s statement when imposing the upper term for defendant’s burglary conviction that it found no mitigating factors to prove the court did not adequately consider all the circumstances relevant to determination of the proper sentence. But defendant is not challenging the court’s imposition of the upper term. Instead, he is challenging the court’s refusal to strike a prior strike allegation and two prior serious felony conviction allegations. When the court ruled on that motion, it considered the circumstances of defendant’s crime as well as factors related to his background, character, and prospects, as it was required to do. (See People v. Williams (1981) 30 Cal.3d 470 , 489 [courts must consider all the facts of the offense and all the circumstances related to defendant when exercising discretion 3 See People v. Estrada (2017) 3 Cal.5th 661 , 666. 9 under § 1385]; see also People v. Shaw (2020) 56 Cal.App.5th 582 , 585-587 [courts apply the same standard when exercising discretion under §1385 to strike a prior serious felony conviction enhancement].) The court further analyzed whether the 22-year sentence imposed was disproportionate to defendant’s conduct as defendant argues on appeal it was required to do under Proposition 36. The court concluded the sentence was not disproportionate because the sentence was necessary to deter defendant’s recidivist behavior in light of defendant’s refusal to take responsibility for committing the burglary. No error occurs if the trial court evaluates all relevant circumstances to ensure that the punishment fits the offense and the offender. (People v. Shaw, supra, 56 Cal.App.5th at p. 587.) Still, defendant argues the court failed to consider defendant’s mental health or appreciate the length of time since he committed his qualifying offenses and remained free from incarceration. Evidence of defendant’s mental health, however, was limited to him receiving an unknown diagnosis as a juvenile and counseling off and on throughout life, which led to other unknown diagnoses. While defendant’s mental health was evaluated in connection with his criminal proceeding, nothing from that evaluation was presented to the court to consider before exercising its discretion to strike defendant’s sentencing allegations. Instead, defendant explained to the probation officer that the need for an evaluation was a misunderstanding. Indeed, defendant did not provide evidence of his current mental health status but instead attributed his current criminality to heavy alcohol and methamphetamine use. The court acknowledged the mitigating effect of addiction and weighed this circumstance in favor of defendant to justify striking one of his strike allegations. Moreover, given defendant’s prolonged addiction and purported mental health challenges, the issues appear intertwined and considered by the trial court. To the extent defendant argues the court did not assign the proper weight to any circumstance surrounding defendant’s offense and personal history, that argument must fail. As long as the trial court weighed all the relevant circumstances, we cannot reverse 10 simply because we disagree with the trial court’s ultimate ruling. (People v. Superior Court (Alvarez), supra, 14 Cal.4th at p. 978.) Here, the court entered a detailed analysis of defendant’s current offense, criminal history, character and prospects, and whether the proposed sentence was disproportionate to defendant’s conduct. Accordingly, the trial court did not abuse its discretion. III The Trial Court Determined Defendant’s Ability To Pay Before Imposing Fines And Fees Defendant contends the trial court erred by failing to hold an ability-to-pay hearing before imposing fines and fees. He acknowledges he was sentenced after Dueñas held that principles of due process would preclude a trial court from imposing the fine and assessments at issue without first determining a defendant’s ability to pay. (People v. Dueñas (2019) 30 Cal.App.5th 1157 .) Defendant, however, fails to acknowledge the trial court here made a finding, based on the length of defendant’s incarceration and his future prospects, that defendant had the ability to pay the fines and fees imposed. Thus, the trial court complied with the holding of Dueñas that it determine defendant’s ability to pay before imposing fines and fees. To the extent defendant wanted the trial court to hold a hearing before determining his ability to pay, defendant was required to object and request a hearing. (See People v. Castellano (2019) 33 Cal.App.5th 485 , 490 [a trial court is required to determine a defendant’s ability to pay only if the defendant raises the issue, and the defendant bears the burden of proving an inability to pay].) Defendant’s failure to do so has resulted in forfeiture of his appellate claim. (Cf. People v. Speight (2014) 227 Cal.App.4th 1229 , 1248-1249 [ruling counsel should have raised an argument during a sentencing hearing that occurred five weeks after a California Supreme Court decision announced the relevant principle].) 11  IV Counsel Was Not Ineffective Defendant contends his counsel was ineffective for failing to request a hearing on whether he qualified for pretrial mental health diversion under section 1001.36 during his criminal proceedings.4 We disagree. “When challenging [counsel’s actions] on grounds of ineffective assistance, the defendant must demonstrate counsel’s inadequacy. To satisfy this burden, the defendant must first show counsel’s performance was deficient, in that it fell below an objective standard of reasonableness under prevailing professional norms. Second, the defendant must show resulting prejudice, i.e., a reasonable probability that, but for counsel’s deficient performance, the outcome of the proceeding would have been different. When examining an ineffective assistance claim, a reviewing court defers to counsel’s reasonable tactical decisions, and there is a presumption counsel acted within the wide range of reasonable professional assistance. It is particularly difficult to prevail on an appellate claim of ineffective assistance. On direct appeal, a conviction will be reversed for ineffective assistance only if (1) the record affirmatively discloses counsel had no rational tactical purpose for the challenged act or omission, (2) counsel was asked for a reason and failed to provide one, or (3) there simply could be no satisfactory explanation. All other claims of ineffective assistance are more appropriately resolved in a habeas corpus proceeding.” (People v. Mai (2013) 57 Cal.4th 986 , 1009.) Section 1001.36 provides pretrial diversion may be granted if the trial court finds all of the following criteria are met: (1) the defendant suffers from a recently diagnosed 4 Defendant spends much time arguing the enactment of section 1001.36 is retroactive to him. But defendant was tried and sentenced after the effective date of section 1001.36, thus there is no dispute that the enactment of pretrial mental health diversion was available to him. (Stats. 2018, ch. 34, § 24, eff. June 27, 2018) 12 mental disorder enumerated in the statute; (2) the disorder was a significant factor in the commission of the charged offense, and that offense is not one of the offenses enumerated in subdivision (b); (3) “[i]n the opinion of a qualified mental health expert, the defendant’s symptoms of the mental disorder motivating the criminal behavior would respond to mental health treatment”; (4) the defendant consents to diversion and waives his right to a speedy trial; (5) the defendant agrees to comply with treatment as a condition of diversion; and (6) the defendant will not pose an unreasonable risk of danger to public safety, as defined in section 1170.18, if treated in the community. (§ 1001.36, subd. (b)(1)-(2).) If the treatment under pretrial diversion is deemed successful, the charges shall be dismissed and the defendant’s criminal record expunged. (§ 1001.36, subds. (b)(1)(A)-(C), (c)(3), (e).) The statute further provides: “At any stage of the proceedings, the court may require the defendant to make a prima facie showing that the defendant will meet the minimum requirements of eligibility for diversion and that the defendant and the offense are suitable for diversion. The hearing on the prima facie showing shall be informal and may proceed on offers of proof, reliable hearsay, and argument of counsel. If a prima facie showing is not made, the court may summarily deny the request for diversion or grant any other relief as may be deemed appropriate.” (§ 1001.36, subd. (b)(3).) Defendant points to his mental competency evaluation, which indicated he suffered from multiple mental health disorders, as well as counsel’s and the court’s comments connecting defendant’s drug use to the commission of the crime as evidence counsel should have requested a hearing. Even so, defendant cannot demonstrate that counsel’s failure to request an eligibility hearing fell below an objective standard of reasonableness. Defendant’s mental competency evaluation included an opinion of the authoring expert that “[b]ased on [defendant’s] history of multiple suicide attempts, antisocial and paranoid personality traits, history of multiple convictions for criminal offenses, the 13 prospect of a lengthy prison sentence, and his current level of anger, . . . [defendant] Poses Moderately High Risk of Harm to Self and Danger to Others.” Further, the court observed when declining to strike several of defendant’s sentencing allegations that a lengthy sentence was necessary to deter defendant’s recidivist behavior and protect the public. While there was no finding defendant posed an unreasonable risk of committing a violent felony, which would disqualify defendant from pretrial diversion (§ 1001.36, subd. (b)(1)(F)), the findings that were made support an inference that counsel’s personal interactions with defendant led counsel to believe defendant was disqualified from pretrial mental health diversion due to his danger to public safety. Accordingly, counsel was not ineffective. DISPOSITION The judgment is affirmed. /s/ Robie, Acting P. J. We concur: /s/ Murray, J. /s/ Hoch, J. 14

2020-01-17 22:01:44.232013+00

Lansdon

*547OPINION. Lansdon: The original petitioner acquired 3,038 acres of coal in 1905,1906, and 1907, at an average cost of $727.18 per acre. The total cost of the two separate tracts acquired in 1906 and 1907 was $125,-022.43, and the undepleted coal therein was sold in the taxable year for $46,219.14. The only question submitted to the Board is whether the loss sustained by the sale in the taxable year shall be computed on the basis of the residual cost per acre of the entire tract of 3,038 acres or of the residual cost of the two tracts separately purchased in 1906 and 1907. The parties agree that depletion, as an element in the determination of the loss, has been properly computed and applied to facts. The respondent based his determination on the admitted fact that the coal sold in 1920 ⅛ conclusively identified as the undepleted remainder of the 346.683 acres bought in 1906 and 1907 at a cost which is not in dispute. The petitioner’s theory is that the coal which it acquired by successive purchases in 1905, 1906, and 1907 was consolidated into a single property which thereafter was operated as a unit and that the effect of such consolidation and operation was that each of the several parcels of land so consolidated lost its identity as an individual item of assets. If this theory is sound it follows that after such consolidation the cost of any part of the entire acreage, for the purpose of computing gain or loss from the sale thereof, can be determined only by applying to it the average acre cost of the entire tract. These contentions require us to decide whether the coal sold in 1920 shall be considered a part of 3,038 acres acquired at a cost of $727.18 per acre, or as the undepleted remainder of a tract of 346.683 acres that was acquired at a cost of $125,022.43. In support of its contention the petitioner relies on article 43 of Regulations 45, as amended by Treasury Decision 3206, which prescribes a rule for determining loss or gain from the sale of real estate -lots, and is as follows: Sale of real estate in lots. Where a tract of land is purchased with a view to dividing it into lots or parcels of ground to be sold as such, the cost shall be equitably apportioned to the several lots or parcels and made a matter *548of record on the books of the taxpayer, to the end that any gain derived from the sale of any such lots or parcels which constitutes taxable income may be returned as income for the year in which the sale was made. This rule contemplates that there will be a measure of gain or loss on every lot or parcel sold, and not that the capital invested in the entire tract shall be extinguished before any taxable income shall be returned. The sale of each lot or parcel will be treated as a separate transaction and the gain or loss will be accounted for as provided in article 1561 as amended. Instead of supporting the contention of the petitioner, the regulation cited appears to be a direction to the Commissioner to do exactly what has been done in this proceeding, since it clearly sets forth that “ the sale of each lot or parcel will be treated as a separate transaction and the gain or loss will be accounted for as provided in article 1561.” In the instant proceeding it appears that the Commissioner regarded the acquisition of the various tracts of coal as separate transactions and, knowing the cost, the depletion, and the sales price of the coal sold in 1920, determined the loss on that sale. Petitioner also cites our decision in J. S. Cullinan, 5 B. T. A. 996, as a recognition of the principle for which it contends. In that proceeding the record discloses that Cullinan acquired throe contiguous parcels of land at an original cost of $135,030.15; made capital improvements thereon at a cost of $93,353.79; subdivided the entire tract into 24 building lots; sold 20 of such lots for $318,640; presented one to his son and retained the remaining three for his own purposes. In our opinion the cited decision does not sustain the theory of this petitioner. In that case the Commissioner did not determine that the cost of each lot was the average cost of all but, in accordance with assessed valuations, allocated the total cost to the several lots and thereby determined the cost of each. Manifestly such procedure was based on the regulation which requires that the sale of each lot shall be regarded as a separate transaction. Cullinan offered no alternative method for computing the costs of the lots sold. ' In its decision the Board neither approved nor disapproved the method by which the Commissioner ascertained the cost of each of the several lots and held only that the evidence adduced by the petitioner failed to overcome the presumption that the Commissioner’s determination of profit was correct. No rule applicable to the situation herein was established. The determination of the Commissioner that the original cost of the Welsh and Millwood tracts of 146.683 and 200 acres, resjoectively, must be regarded as the basis for computing the loss sustained from the sale in the taxable year of the remaining undenleted coal in such tracts, is approved. Decision will be entered wider Rule 50.

2020-01-17 22:01:44.264803+00

Trussell

*551OPINION. TRUssell : The picture of the petitioner presented by the record in this proceeding is one of a business of purely personal service of professional character furnished to clients, this business built around and absolutely dependent upon the knowledge, training, experience and reputation of one individual whose name the corporation bears. Section 200 of the Revenue Act of 1918 defines a personal service corporation as: * * * A corporation whose income is to be ascribed primarily to the activities of the principal owners or stockholders who are themselves regularly engaged in the active conduct of the affairs of the corporation and in which capital (whether invested or borrowed) is not a material income-producing factor; ⅜ * *. That Ernest J. Goulston owned all of petitioner’s stock and was regularly engaged in the active conduct of its affairs is shown by the record without contradiction. Upon the question as to whether petitioner’s income must be ascribed primarily to his activities, it is shown that Goulston was in entire charge of the business and directed and supervised the work of its four other employees. Three of theso employees performed what it is evident were merely clerical duties. The fourth acted as a paid assistant to Goulston, performing work in production and solicitation similar to that done by the latter but all under his direction. The evidence convinces us that the business *552received by petitioner was business given by clients because of Goul-ston’s knowledge, experience and judgment; that these clients were employing Goulston’s services; and that the income received was consequently primarily due to the latter’s activities and personal supervision of all the work. ' In respect to the question as to whether capital was a material factor in the producing of petitioner’s income, the record shows that the entire capital invested on organization was $3,000 and that the use of this in the production of income was limited to office furniture and petty cash. It is shown that petitioner’s clients were large business concerns who paid their bills promptly and that petitioner in furnishing service arranged for the payment by clients of their accounts at a period prior to its having to meet expenses incurred on account of such service and in this way it secured the funds necessary to be used. The amount of capital is trifling in comparison with the total income produced, which for the calendar years 1919 and 1920, including amounts paid Goulston as salary, was reported by petitioner in its returns as $28,000 and $36,000 respectively. In view of this evidence we can but conclude that the income of petitioner was produced 'by the personal service rendered and the use of capital was an incidental and minor factor. See H. S. Jaudon Engineering Co., 15 B. T. A. 161; Crosby-Chicago, 14 B. T. A. 19; H. K. McCann Co., 14 B. T. A. 234; Sweeney & James Co., 10 B. T. A. 966; Fuller & Smith v. Routzahn, 23 Fed. (2d) 959. . By the exemption from taxation of corporations as such when the conditions enumerated in section 200 of the Revenue Act of 1918 exist, the intent of Congress is clearly evident to treat a revenue-producing organization upon its substance rather than its form and to consider as a partnership for income-tax purposes a corporation whose character as such is evidenced solely by its activities being carried on under a corporate charter and where the activities themselves and the production of income through those owning the business, as distinguished from the mere use of capital, show it to be an association of individuals obtaining a return for the furnishing of their personal service, and such as could be and generally is carried on under a partnership contract. In the present case it is noted that the business of petitioner had been carried on prior to August, 1918, as a personal business of Goulston, its profits being his personal income and taxable as such, and that the incorporation of it effected no change whatsoever in the manner in which it was conducted, the interest of Goulston in the profits or the extent of his participation in its activities and the production of its income thereby. The business continued under the same name with merely a formal organization of corporate character, acquired solely for the purpose of avoiding a bankruptcy proceeding and to satisfy his personal credi*553tors that the profits, after they were earned, would be applied in payment of his personal debts. We hold that petitioner is entitled to classification as a personal service corporation for the taxable years in question. Judgment will be entered for the 'petitioner.

2020-01-17 22:01:44.421272+00

Littleton

*568OPINION. Littleton: The issue is whether the amount of $50,000 paid by the petitioner to Finsterwald and King in consideration for their becoming guarantors for the petitioner in the fulfillment of the terms and conditions of a certain lease constitutes an allowable deduction from gross income under the provisions of section 234 (a) (1), which reads as follows: (a) That in computing the net income of a corporation subject to the tax imposed by section 230 there shall be allowed as deductions: (1) All the ordinary and necessary expenses paid or incurred during the taxable year in carrying on any trade or business, including a reasonable allowance for salaries or other compensation for personal services actually rendered, and including rentals or other payments required to be made as a condition to the continued use or possession of property to which the corporation has not taken or is not taking title, or in which it has no equity. The facts are not in dispute. In brief they show that when in 1920 the petitioner sought to renew the lease on the premises which it was then occupying, it became necessary for the petitioner to pay $50,000 in order to secure the renewal lease. At that time the existing or old lease had six years yet to run, and the petitioner, bj»- the renewal lease, secured no modification of the old lease. The payments in question were not made to the lessor, but were made to two individuals in consideration of their becoming guarantors for the fulfillment of the lease contract by"the petitioner as lessee. As such it was not a bonus paid of the character we find which is often referred to as additional rent or a part of the rent paid in advance. It was, however, as necessary to the securing of the renewal as if it had been a bonus or price specified in the lease, since the reasonable deduction to be drawn from the facts is that the renewal could not have been obtained without making this expenditure. The petitioner’s argument in support of the deduction is directed largely to the proposition that this was an expense prudently incurred, proximate to the business and reasonably necessary and, therefore, it must be classifie'd as a deductible expense in the nature of insurance premiums or as compensation for services rendered. What the petitioner says is a true statement of what occurred, but we can not agree with the ultimate conclusion reached, namely, that this is *569an ordinary and necessary expense deductible under, the provisions of section 234 (a) (1), supra; J. Alland & Bro., 1 B. T. A. 631; 28 Fed. (2d) 792. The line to be drawn between capital and expense items is often difficult to define and must be decided upon the basis of the-facts in a particular case, but we fail to see where the prudence with which the expense was incurred, its proximity to the business, and its reasonable necessity assist us in mailing a distinction between the two classes of items. These considerations would apply equally to an outlay of money, whether it be for something which is to contribute to the income-producing activities over a period of years or whether it be for something from which the benefit is applicable only to the year in which the expenditure was made, and therefore chargeable only to such year’s operations. Nor does the fact that the expenditure was for salary in the form of compensation for services rendered or for insurance, necessarily rob it of its capital nature. Certainly, where a taxpayer constructs a building with its own labor, paying salaries and wages for such work and also paying for insurance the benefits from which are applicable only to the period of construction, it could hardly be said that those expenditures are not of a capital nature. In effect, they are expenditures made in the acquisition of a building, a capital asset, for the purpose of producing income over a period of years and, therefore, would not be chargeable against income for a single year. Then, too, organization expenses in connection with the formation of a corporation may include compensation for services rendered, but they are not allowable deductions from gross income. See Goodell-Pratt Co., 3 B. T. A. 30; Columbia Theatre Co., B. T. A. 622; First National Bank of St. Louis, 3 B. T. A. 807. As we view the situation, the expenditure was made in connection with the acquisition of a capital asset, the new lease, and was as much a part of the cost as if it had been paid to an agent in an outright acquisition of a lease. In other words it was an amount paid in order to acquire the lease, and we do not think it material that it was not paid to the party from whom the lease was obtained. The benefits from such expenditure were not confined to the year when made, but would extend to the end of the renewal lease. It may well be that some benefits from making this expenditure in 1920 accrued to the petitioner at that time and were not confined to the period of the renewal lease, since the petitioner was thus assured that it could continue its operations at that place for 16 years instead of only 6 years and, consequently, was enabled to make plans for the future in a manner which it could not, have done without the renewal lease, but this is no argument for saying that this was am ordinary and necessary expense applicable only to the year 1920. On the whole, we are satisfied that this Avas a capita] expenditure and, accordingly, the Commissioner’s action in so treating it is sustained. *570What part of it, if any, might be deductible in 1920 we have no evidence from which we can determine. Judgment will be entered for the respondent.

2020-01-17 22:01:44.449113+00

Trtjssell

*59opinion. TRtjssell: The sole issue in this case is whether the petitioner is entitled to deduct from income*additional allowances for salaries of *60its president and its treasurer-general manager. The respondent has allowed the deduction of the salary actually paid to the treasurer-general manager. The additional deductions how contended for were not claimed in the returns filed by the petitioner. Shortly after the petitioner was incorporated the directors authorized salaries as follows: for Connor, the president, $5,000 per annum; for Noll, the treasurer and general manager, $5,000 per annum as treasurer and $4,000 per annum as general manager. An understanding was arrived at orally at this meeting, however, to the effect that the salaries would not be paid if the income derived from operations was insufficient or if the cash capital necessary for the payment was not available. Noll regularly drew a salary of $75 per week, but he has never drawn any additional salary nor has Connor ever drawn any salary whatever. The undrawn salaries were not accrued upon the books of the petitioner. After several years of operation Connor and Noll disposed of their stockholdings in the petitioner and without claiming any part of the back salaries, they gave releases of all demands upon the petitioner. Deductions from income for salaries are authorized in section 234 (a) (1) of the Revenue Act.of 1921, with the provisos that the amount of the allowance shall be reasonable, the services shall have been actually rendered, and the expense shall have been paid or incurred during the taxable year. In a situation such as this, where the petitioner comes forward to claim a deduction for expense which it did not claim when it filed the return and which is lacking of any support whatever from the books of account, due to the failure to accrue the salaries as liabilities, the first question which naturally arises is whether the expense was actually incurred dur,ing the taxable year. If it was not so incurred it is not deductible and it would be unnecessary to go into the question of the amount of a reasonable allowance. It is in evidence that prior to the beginning of operations the board of directors of the petitioner duly authorized salaries in the amounts set out in the findings, but the directors also reached the understanding at this same meeting that the salaries would not be paid if cash was lacking or if, furthermore, the income from operations was insufficient. The petitioner was a close corporation. Conner and Noll, the intended recipients of the salaries, were two of the three individuals forming the board of directors. They were constantly in touch with the affairs of the petitioner and in daily contact with each other. They were the executive officers of the petitioner as well as directors. A salary was paid to Noll regularly, but the additional salaries now claimed have never been entered upon the books or claimed by the officers. In consideration of all of these facts the conclusion is unescapable that the original authorization was no *61more'than tentative and the interested parties by mutual understanding determined the amount of salaries actually incurred by the petitioner to be no more than the amount actually paid. Such a readjustment is no novelty in corporation procedure. The amounts finally agreed upon are governing. Whitney Coal Mining Co., 4 B. T. A. 310. Certainly there is afforded no support to the petitioner’s contention by any fine-spun theory of constructive receipt by the officers followed by a gift to the corporation through forgiveness of indebtedness. Cf. H. C. Couch, 1 B. T. A. 103. In our opinion there is no sufficient basis for an allowance of a deduction greater than that already allowed by the respondent. Cf. H. B. Hill, 3 B. T. A. 761; George Bernards’, Inc., 8 B. T. A. 716; Arcadia Amusement Co., 14 B. T. A. 1335. Judgment will he entered for the respondent.

2020-01-17 22:01:44.479893+00

Littleton

*575OPINION. Littleton : The liability here in question is predicated upon the theory that there was a sale by the Caudill Branch Coal Co. of its assets to the Dudley Coal Co. in which the former company realized a profit, and that since the Caudill Company has been dissolved and *576lias been divested of all of its assets, the petitioner, as a former stockholder of this corporation, should be held liable as a transferee, under the provisions of section 280 of the Revenue Act of 1926, for a part of the tax due from the corporation. The first defense made by the petitioner is that this was not a sale of assets by the Caudill Company, but rather a sale of stock by the stockholders of the Caudill Company through which the Dudley Company first acquired the stock of the Caudill Company and then came into ownership of the assets of the Caudill Company through a liquidation to it by the Caudill Company. At the outset it should be obseiwed that what finally happened was that the assets which were owned by the Caudill Company at the beginning of these negotiations were OAvned by-the Dudley Company when the final plan was carried out, nor do we think that it can admit of doubt that this was the end in view and in contemplation of the parties from the very beginning. The controversy arises, however, because the Commissioner contends that the end was accomplished through a sale of assets by the Caudill Company to the Dudley Company, whereas the petitioner contends that it was accomplished through an acquisition of the stock of the Caudill Company by the Dudley Company and then a liquidation of the former company to the latter. On a consideration of the entire record, we are of the opinion that the petitioner’s view must be sustained. In the first place, the agreement under which the assets of the Caudill Company found their way to the Dudley Company was an agreement between the petitioner and the stockholders of the Caudill Company, and not an agreement to which the Caudill Company was in any sense a party. It is too well established to require a citation of authority that the assets of a corporation are not owned by the stockholders, but by the corporation itself, and that the stockholders (even if all had been a party to the offer to the petitioner, which is not true in this instance) can not dispose of the corporation’s assets. In United States v. Board, 14 Fed. (2d) 459, the District Court for the Western District of Kentucky had occasion to consider a contract somewhat similar in character' to the one here in question, and there made the following statement with reference to the law in Kentucky as to the sale of corporate assets: With these principles in mind, it is difficult to reach any other conclusion than that this contract was a sale of stock by the stockholders. To construe the contract as one of sale of assets of the corporation would, in effect, be to declare it an unenforceable contract, because it is well settled that stockholders, as such, under the Kentucky law, cannot sell the assets of a corporation. It is true that, under section 883b of Kentucky Statutes (Acts Ky. 1918, c. 15), no sale of all of a corporation’s assets is valid, unless consented to by the holders of not less than three-fourths of the capital stock of the vendor corporation, which consent must be evidenced in writing, or by a vote at a special *577meeting of the stockholders called for that purpose; but such consent does not effectuate a sale of the assets. Under the Kentucky law the affairs of the corporation must be conducted by a board of directors, and, notwithstanding the consent of the stockholders to the sale of the corporation’s assets, the contract of sale must be executed by the board of directors of the corporation. No such action on the part of the board of directors is shown in this record. Therefore the instrument should be construed as a sale of stock by the stockholders, rather than as an attempt by the stockholders to sell corporate assets, if the instrument and the evidence heard reasonably admit of such a construction. It is true that in the offer made by the stockholders in the case at bar it was specified that the corporation required to be formed as a condition precedent to accepting the offer, should have the necessary powers to acquire the assets of the Caudill Company and that after it was formed it should acquire the assets in question, but we do not understand this to be sufficient to bind the Caudill Company to an act to which it was not a party, nor to give to the stockholders authority to do something concerning which they did not otherwise have authority. Likewise, we fail to see wherein the resolution of the Dudley Company, purporting to ratify the agreements of petitioner and the Caudill Company with respect to the purchase of the properties of the Caudill Company, could amount to making the Caudill Company a party to the agreements when the evidence is to the effect that the agreements were between the petitioner and the stockholders .of the Caudill Company. The Dudley Company could hardly ratify more than had taken place, nor could it act for an entirely separate corporate entity, the Caudill Company. Petitioner appears to have been acting in contemplation of the formation of the Dudley Company and to have formed the Dudley Company for the purpose of having this corporation own and operate the properties of the Caudill Company, but the mere fact that the Dudley Company ratified acts of the petitioner leading to the acquisition would not, .of itself, make the Caudill Company a party to these negotiations. Another important factor in our conclusion is that the consideration mentioned in the negotiations between petitioner and the stockholders of the Caudill Company was paid direct to the stockholders and not to the Caudill Company itself. The argument of the Commissioner that this consideration was constructively received by the Caudill Company, and then paid to the stockholders would have more force had the Caudill Company, in its corporate capacity, been a party to the negotiations, but, as we have stated above, this was not true. It can not be questioned that a stockholder may contract with an individual or a corporation for the sale of his stock and that the consideration paid for his stock becomes his absolute property without any participation on the part of the corporation. To *578hold otherwise would be contrary to the well established principle of a corporate entity separate and apart from the stockholders. What happened here was that the petitioner contracted for the purchase of a majority of the stock of the Caudill Company and that, through appropriate corporation action, the Dudley Company completed the negotiations by paying direct to the stockholders the consideration agreed upon and received the stock. We do not conceive the situation would have been different had the Dudley Company, without the intervention of petitioner or another individual, secured the assets of the Caudill Company through an acquisition of the stock of the Caudill Company and the subsequent liquidation of the Caudill Company. In such a situation the profit would have been to the stockholders on account of their sale of stock, and also a possible profit to the Dudley Company of the difference between the price paid for the stock by it and the value of the assets received in liquidation. Regal Shoe Co., 1 B. T. A. 896. See, also, United States v. Board, supra. But the Caudill Company would not be taxable on a profit, for the reason that it received nothing on account of which gain or loss could be computed. Much is said in the Commissioner’s argument to the effect that substance, rather than form, should be our guiding principle in the determination of the question here at issue and this, of course, is so well established as to be almost axiomatic, but we do not understand that this principle goes to the extent of requiring a finding that something occurred which, in fact, did not occur. To accomplish the purpose contemplated by the parties, at least two equally effective methods were open to them, namely, a purchase of the stock of the Caudill Company from its stockholders, followed by a liquidation of this company to the purchaser, or the purchase of the assets direct from the Caudill Company, followed by a liquidation to its stockholders. The fact that in either case the assets of the Caudill Company would find their way to the Dudley Company would not require us to say that the substance of the transaction for tax purposes was the same regardless of the method pursued. Nor do we understand that a taxpayer is subject to legal censure because he has been so fortunate as to select a method of carrying out a given transaction that produces less tax than if a different plan had been followed, provided good faith is shown, and there is no intimation of fraud or bad faith in this transaction. We must determine tax liability on the basis of what occurred and not on the possible or probable course which would have produced a greater tax. When viewed in the light of the foregoing considerations, we are unable to escape the conclusion that the transaction in question amounted to a sale of stock by the stockholders of the Caudill Com*579pany and not a sale of assets by the Caudill Company. It follows, therefore, that the Caudill Company is not taxable on a profit from the transaction and that the liability sought to be asserted against the petitioner on account thereof is erroneous. In view of the foregoing conclusion it is unnecessary to consider the second issue. Judgment will he entered for the fetition&r.

2012-04-17 05:16:08+00

http://bulk.resource.org/courts.gov/c/F3/50/50.F3d.1039.94-8401.html

50 F.3d 1039 Garmon v. Virginia Paper** NO. 94-8401 United States Court of Appeals, Eleventh Circuit. Mar 14, 1995 Appeal From: S.D.Ga., No. 92-00045-CV-3 1 AFFIRMED. ** Local Rule 36 case

2020-12-01 22:04:04.745028+00

http://www.illinoiscourts.gov/Opinions/AppellateCourt/2020/1stDistrict/1170310.pdf

2020 IL App (1st) 170310 No. 1-17-0310 Opinion filed December 1, 2020. Second Division ______________________________________________________________________________ IN THE APPELLATE COURT OF ILLINOIS FIRST DISTRICT ______________________________________________________________________________ THE PEOPLE OF THE STATE OF ILLINOIS, ) Appeal from the ) Circuit Court of Plaintiff-Appellee, ) Cook County. ) v. ) No. 11 CR 08111-02 ) SHANTE THOMAS, ) The Honorable ) Brian K. Flaherty, Defendant-Appellant. ) Judge Presiding. ______________________________________________________________________________ JUSTICE LAVIN delivered the judgment of the court, with opinion. Presiding Justice Fitzgerald Smith and Justice Cobbs concurred in the judgment and opinion. OPINION ¶1 Following simultaneous but severed jury trials, defendant Shante Thomas and her boyfriend, codefendant Deandre Minkens, were found guilty of first degree murder (720 ILCS 5/9-1(a)(1) (West 2010)) of Rosemary Newman (the victim) and intentional homicide of her unborn child (id. § 9-1.2(a)(1)). 1 Defendant was sentenced to natural life in prison. 1 Codefendant is not a party to this appeal. We note, however, that codefendant’s convictions were affirmed by this court in People v. Minkens, 2020 IL App (1st) 172808 . No. 1-17-0310 ¶2 In this direct appeal, defendant challenges the trial court’s denial of her pretrial motions to quash arrest and suppress incriminating statements made at the police station and to admit evidence of codefendant’s violent nature. Defendant also challenges the trial court’s refusal to give non-Illinois Pattern Jury Instructions (IPI) on obstruction of justice, even though she was not charged with that offense in the indictment and conceded that it was not a lesser included offense of those for which she was charged. Last, defendant challenges her murder conviction based on the sufficiency of the evidence and her discretionary life sentence as unconstitutionally excessive. Finding no merit in defendant’s arguments, we affirm. ¶3 BACKGROUND ¶4 Defendant was 19 years old when she accompanied codefendant to the police station after he was arrested for first degree murder of the victim and intentional homicide of her unborn child on April 25, 2011. Defendant left the station later that night but returned the following day. Meanwhile, the police learned that defendant had misled them in their investigation of the victim’s murder. ¶5 Defendant was initially arrested for obstruction of justice on April 26, 2011. Thereafter, defendant confessed that she was involved in the victim’s murder and was then charged with the above-stated offenses (see supra ¶ 1). ¶6 Prior to trial, defendant filed several motions to quash arrest and suppress evidence, arguing, in the main, that she was in custody without probable cause beginning on April 25, 2011, when codefendant was arrested; thus, her subsequent confession was inadmissible as fruit of the poisonous tree. In response, the State argued that defendant voluntarily chose to accompany codefendant to the police station where she was treated as a witness, not a suspect, and that she voluntarily returned the following day. -2- No. 1-17-0310 ¶7 Evidence at the hearings on defendant’s motions generally showed that around 3:30 p.m. on April 25, 2011, defendant was with codefendant near her home when he was arrested for the murder. The police asked defendant if she wanted to accompany codefendant to the police station. She said yes and was given a ride by the police. Unlike codefendant, however, defendant was not handcuffed when the police drove her in a separate vehicle from him that did not contain a barrier between the front and back seats. Defendant was also allowed to keep her personal belongings, including her cell phone. ¶8 At the station, defendant told the police that she had been with codefendant and their friend, Joshua Miller, the night the victim was murdered. Because defendant was not considered a suspect at that time, her statements were not recorded. The police drove defendant home later that night. Meanwhile, the police learned that Miller had not been with defendant or codefendant the night in question but, instead, had been asked to provide an alibi by codefendant prior to his arrest and then again by defendant after she left the police station that night. ¶9 The next evening, on April 26, 2011, defendant returned to the station with her mother, Mia Fox. The police told defendant what Miller had said but she nevertheless maintained her initial story. Still, she refused to take a polygraph test, asking for an attorney instead. ¶ 10 We note that defendant’s mother called an attorney, Raymond Kennan, on April 27, 2011. Kennan’s testimony, however, established that he never represented defendant even though he spoke to one of the detectives about the investigation while she was at the police station. 2 ¶ 11 In any event, the police stopped all questioning after defendant asked for an attorney. Subsequently, defendant was arrested for obstruction of justice. She then asked to speak to one 2 Notably, Kennan did not ask whether defendant had been Mirandized (see Miranda v. Arizona, 384 U.S. 436 (1966)) when the detective informed him that she was being charged with murder. -3- No. 1-17-0310 of the detectives. Defendant was informed of her Miranda rights but waived them and agreed to take a polygraph test. We note, however, that after defendant was arrested for obstruction of justice, all ensuing conversations with the police were electronically recorded, also known as electronic recording of interrogations. ¶ 12 Defendant again waived her Miranda rights before taking the polygraph test the next morning. During the test, she was given food and a blanket and allowed to use the bathroom. The results of defendant’s polygraph test were consistent with her having provided false information to the police about her whereabouts the night the victim was murdered. After defendant was informed of the test results, she spoke to her mother and then asked to speak to one of the detectives. She continued to change her story as to the events that occurred on the night in question but eventually confessed that she was in codefendant’s car when the victim was murdered and then went to the forest preserve with him to dump her body. ¶ 13 Ultimately, the trial court denied defendant’s motions to quash arrest and suppress her statements made at the police station, including her confession. In reaching its decision, the court concluded that defendant voluntarily went to the police station when codefendant was arrested and that there was probable cause to arrest her for obstruction of justice the following day. The court further concluded that suppression was not warranted because defendant’s statements were made voluntarily either before she was in custody or after she had been Mirandized. ¶ 14 The trial court also denied defendant’s pretrial motions to admit evidence related to codefendant’s violent nature, including past crimes and out-of-court statements made by the victim to her friend. ¶ 15 The cause proceeded to trial where the following evidence, consisting of many of the facts already presented at the suppression hearings, was adduced. In the summer of 2010, -4- No. 1-17-0310 defendant was in a relationship with codefendant when he began seeing the victim, who later became pregnant, presumably with his child. When defendant learned of the situation, she was incensed and, consequently, began threatening the victim, leading her to file police reports against defendant. Testimony of the victim’s close friend, Nailah Washington, also revealed that defendant had threatened the victim on multiple occasions. On one of those occasions, defendant called the victim, letting her know that she was “fucking with the [wrong] family.” ¶ 16 Around 10 p.m. on April 23, 2011, the victim, then nine months pregnant, was living with her mother, Rosie Newman (Newman), when she left to meet codefendant. He picked her up and drove them to an Applebee’s restaurant less than two miles away, located at 4937 Cal Sag Road in Crestwood, Illinois. After they arrived, the victim called her mother, letting her know they made it to the restaurant safely and that she would be home soon. 3 But the victim never made it home. ¶ 17 The next morning, on Easter Sunday, codefendant called Newman, asking to speak to the victim. He claimed to have been with defendant the night before, not with the victim. Newman immediately called the police to file a missing person’s report. A short time later, Alsip police officers Joshua Spencer and Hector Puente arrived at Newman’s apartment where she explained to them the above-stated events. She gave them codefendant’s phone number but their calls to him went unanswered. Newman also described her daughter the last time she ever saw her, stating she was wearing a green T-shirt and black pants and had red-tinted hair that was tightly braided. ¶ 18 When the officers entered the victim’s information in the police database, they discovered her previous reports of being threatened by defendant, as mentioned above (supra 3 The victim made the call on Newman’s cellphone which she regularly used because she did not have her own. -5- No. 1-17-0310 ¶ 15). Meanwhile, a body was found matching the victim’s description less than three blocks away from codefendant’s home, in a Calumet City forest preserve. ¶ 19 Testimony from the detectives who were called to assist with the investigation of the body that was found, and later identified as the victim, indicated they found her lying facedown wearing only a “green T-shirt, underwear and ankle socks.” Additionally, the detectives observed injuries to the victim’s mouth, nose, neck, and back, as well as petechial hemorrhaging in her eyes, indicating manual strangulation. The victim’s autopsy confirmed those observations, revealing that she suffered blunt force trauma to the head and died from strangulation. ¶ 20 Later that afternoon, codefendant returned Officer Spencer’s call, claiming that he had not seen the victim in several days even though two Applebee’s employees confirmed that he had been with her at the restaurant the night before. Nevertheless, codefendant claimed that he had been at a night club known as “The Lick” in Harvey, Illinois, but surveillance video showed him and defendant more than 30 miles away from that club at a gas station near defendant’s home. They were in a white four-door Saturn that the officers had learned belonged to codefendant. ¶ 21 The State introduced forensic evidence of the victim’s fingernail clippings, containing “blood-like stains,” recovered from codefendant’s car, as well as DNA evidence showing that blood found in the car matched defendant’s, codefendant’s, and the victim’s profiles. The State also introduced the electronic recordings of defendant’s interrogations, admitting that she was in codefendant’s car when the victim was murdered and then at the forest preserve where her body was found. ¶ 22 Defendant’s confession was consistent with the testimony of codefendant’s cellmate, a jailhouse informant. That testimony largely reflected that, on the night in question, codefendant -6- No. 1-17-0310 took the victim to Applebee’s while defendant hid in the trunk of his car, which had an access panel to the backseat. At some point after they got back in the car, codefendant turned up the radio volume, signaling defendant, who then lunged through the access panel and strangled the victim while he punched her in the stomach. After the victim stopped breathing, they dumped her body in the forest preserve and went to defendant’s home. ¶ 23 The jury found defendant guilty of first degree murder of the victim and intentional homicide of her unborn child. The trial court then sentenced defendant to natural life in prison. ¶ 24 Defendant filed a motion to reconsider her sentence, asserting that the trial court misconstrued the sentencing statute as to the unborn child’s death and unfairly imposed the same sentence that codefendant, a repeat violent offender, received. In rejecting those arguments, the trial court underscored defendant’s evil actions in committing the offenses, stating: “To say that this was a horrific crime *** would be an understatement. And [defendant] was not simply some passive participant in this crime. She was active in the planning. From the testimony it came out that she was active in the execution of this senseless killing of this young woman. Again, she was not just sitting by, watching. She was actively participating in the murder of this young woman.” The trial court denied defendant’s motion on May 3, 2017. 4 ¶ 25 This appeal followed. ¶ 26 ANALYSIS ¶ 27 Defendant first contends that the trial court erroneously denied her pretrial motions to quash arrest and suppress evidence because she was in custody beginning on April 25, 2011, before the police acquired probable cause when she confessed that she was involved in the 4 The trial court also denied defendant’s pro se motion to reduce her sentence. -7- No. 1-17-0310 victim’s murder. In response, the State maintains that defendant was not in custody until she was arrested for obstruction of justice on April 26, 2011, after which she waived her Miranda rights and confessed. ¶ 28 Before proceeding to the merits, however, we note that both parties have failed to provide proper citation to the record or authorities relied upon in the statement of facts and argument sections of their briefs, in violation of Illinois Supreme Court Rule 341(h)(5), (h)(7), (i) (eff. Oct. 1, 2020). And where citations are provided, they are either erroneous or do not correspond with the preceding statement or argument. See id. This court is not a repository into which the parties may foist the burden of argument and research. People v. Jacobs, 405 Ill. App. 3d 210 , 218 (2010). Furthermore, it is neither our function nor obligation to act as an advocate of either party or to search the record for error. Id. Even though we will proceed to consider the merits of defendant’s appeal, we strongly advise both parties to refrain from such noncompliance going forward. ¶ 29 When reviewing a trial court’s rulings on motions to quash arrest and suppress evidence, where mixed questions of fact and law are presented, we apply a two-part standard of review. People v. Soto, 2017 IL App (1st) 140893 , ¶ 48; People v. Payne, 393 Ill. App. 3d 175 , 179-80 (2009). We will not reverse the trial court’s findings of fact unless they are against the manifest weight of the evidence, i.e., only when the opposite conclusion is clearly evident. Soto, 2017 IL App (1st) 140893 , ¶ 48. In contrast, we review the trial court’s legal ruling as to whether suppression was warranted de novo. Id. In doing so, we may consider trial evidence, as well as evidence presented at the hearings on the motions to quash arrest and suppress evidence. Id. ¶ 30 The first issue before us is whether defendant was, in fact, in custody before she confessed. A person is in custody when her freedom of movement has been restrained or when a -8- No. 1-17-0310 reasonable person under the same circumstances would not have felt free to leave. People v. Slater, 228 Ill. 2d 137 , 150 (2008); People v. Melock, 149 Ill. 2d 423 , 436 (1992). ¶ 31 Here, defendant was not in custody until she was arrested for obstruction of justice on April 26, 2011. As set forth above, defendant voluntarily chose to accompany codefendant to the police station the day before. She was neither handcuffed nor denied access to her personal belongings, including her cellphone, and was driven in a separate police vehicle from codefendant that did not have a barrier between the front and back seats. Additionally, defendant left the police station later that night and was even given a ride home. Defendant then voluntarily agreed to return to the station the next day with her mother. Under those circumstances, we cannot say that defendant’s freedom of movement had been restrained or that a reasonable person would not have felt free to leave. ¶ 32 Moreover, it is important to note that, when the police arrested codefendant, they were aware that defendant had threatened the victim in the past (see supra ¶¶ 15, 18) but still did not question her about it. This suggests that defendant was not considered a suspect or in custody on April 25, 2011. 5 Accordingly, we conclude that defendant was not in custody before she confessed. ¶ 33 Next, we must determine whether defendant’s confession in this case was voluntary. The fifth amendment and the Illinois Constitution of 1970 (U.S. Const., amend. V; Ill. Const. 1970, art. I, § 10) protect an individual’s right against self-incrimination in custodial interrogations by requiring that a defendant be informed of her rights to remain silent and to an attorney and that 5 We note that, because defendant was not in custody on April 25, 2011, her nonrecorded statements made at the police station that day were admissible at trial. But cf. 725 ILCS 5/103-2.1(b)(1) (West 2012) (stating that “[a]n oral, written or sign language statement of an accused made as a result of a custodial interrogation conducted at a police station *** shall be presumed to be inadmissible as evidence against the accused” unless “an electronic recording is made of the custodial interrogation”). -9- No. 1-17-0310 any statement given may be used against her in court. People v. Dennis, 373 Ill. App. 3d 30 , 42 (2007) (citing Miranda v. Arizona, 384 U.S. 436 , 475-77 (1966)). A defendant waives her Miranda rights, however, where the decision to relinquish those rights was voluntary, i.e., it was not the result of intimidation, coercion, or deception and where it was made with full awareness of the nature of the rights being abandoned and the consequences thereof. People v. Crotty, 394 Ill. App. 3d 651 , 662 (2009). ¶ 34 Here, defendant was informed of her Miranda rights when she was arrested for obstruction of justice and again before she was given the polygraph test. In both instances, defendant made a conscious, voluntary decision to waive those rights under no threat of intimidation, coercion, or deception. To the contrary, defendant was fully informed of the murder investigation, including Miller’s statements to the police that belied her own. She was allowed to see her mother and use the bathroom upon request and was given food, soda, and a blanket. Furthermore, the record suggests that defendant was aware of the nature of the rights she was waiving and the consequences thereof because she asked for an attorney before she was in custody; thus, defendant had some understanding of Miranda rights before she was informed of them (see supra ¶ 9). Yet, she chose to waive those rights on two separate occasions on different days. Thus, we conclude that defendant’s confession in this case was voluntary. ¶ 35 Based on the foregoing, we cannot say the trial court’s findings that defendant was not in custody before she confessed and that her confession was voluntary were against the manifest weight of the evidence or that suppression of her confession was warranted. Accordingly, the trial court properly denied defendant’s pretrial motions to quash arrest and suppress evidence. ¶ 36 We also conclude that the trial court did not abuse its discretion in denying defendant’s pretrial motions to admit evidence of codefendant’s past crimes and out-of-court statements - 10 - No. 1-17-0310 made by the victim to her friend. See People v. Lopez, 2014 IL App (1st) 102938-B , ¶ 22 (stating that evidentiary rulings rest within the sound discretion of the trial court whose determinations will not be reversed on appeal absent a clear abuse of discretion). ¶ 37 Where, as here, a defendant seeks to admit evidence of prior crimes that she was not involved in, admissibility is judged under ordinary principles of relevance. See id; People v. Pikes, 2013 IL 115171 , ¶ 20 (where the prior or collateral crimes were not committed by the defendant, the admissibility of that evidence is judged under ordinary relevancy principles rather than traditional other-crimes analysis). In this regard, proffered evidence is admissible if it tends to prove or disprove the offenses charged, and that evidence is relevant only if it tends to make the question of guilt more or less probable. People v. Hill, 2014 IL App (2d) 120506 , ¶ 50. ¶ 38 In this case, defendant sought to admit evidence of codefendant’s past crimes involving domestic violence, including a conviction for first degree cruelty to children. Defendant, however, has not shown, or argued, that evidence was relevant to her defense by establishing that it either disproved the offenses charged against her or called her guilt into question. See Ill. S. Ct. R. 341(h)(7) (eff. Oct. 1, 2020) (stating that an appellant’s brief “shall contain the contentions of the appellant and the reasons therefor, with citation of the authorities and the pages of the record relied on”). ¶ 39 To the extent defendant asserts that codefendant’s past crimes were admissible under section 7.4 of the Code of Criminal Procedure of 1963 (Code) (725 ILCS 5/115-7.4 (West 2014)), this applies only to evidence in domestic violence cases “in which the defendant is accused of an offense of domestic violence.” (Emphasis added.) Id. § 115-7.4(a). Because defendant was not accused of the domestic-related offenses committed by codefendant, that evidence was not admissible. And, while that evidence may have shown codefendant’s - 11 - No. 1-17-0310 propensity for violence, it had no bearing on whether defendant was guilty in this case because she never claimed in her pretrial motions or at trial to have been a victim of his violence or to have been acting in self defense. 6 Cf. People v. Lynch, 104 Ill. 2d 194 , 200-01 (1984) (holding that the victim’s aggressive and violent character was relevant to show who was the aggressor where the victim raised the theory of self defense). In fact, defendant expressly stated in her motion to admit codefendant’s past crimes that she “in no way asserts a claim of self defense.” We therefore conclude that codefendant’s past crimes were not admissible in this case. ¶ 40 For the same reasons, the victim’s prior out-of-court statements made to her friend regarding codefendant’s violent temper were not relevant as to whether defendant had committed the charged offenses in this case or whether she was guilty. Regardless, the victim’s statements were inadmissible hearsay that did not constitute dying declarations subject to exception under Illinois Rule of Evidence 804(b)(2) (eff. Jan. 1, 2011) because they were made several weeks before she was murdered. The victim’s statements, therefore, could not have pertained to either the cause or circumstances of her murder. See Ill. R. Evid. 804(b)(2) (eff. Jan. 1, 2011); see also People v. Perkins, 2018 IL App (1st) 133981 , ¶ 57 (noting that statements cannot be admitted as dying declarations unless they were made under the belief of impending death and relate to the cause or circumstances of the underlying homicide). ¶ 41 Likewise, the victim’s hearsay statements were not admissible under section 115-10.2a of the Code (725 ILCS 5/115-10.2a(a) (West 2014)) because the victim in this case was not abused by a family or household member. See id. § 115-10.2a(a) (applying only to statements made “by an individual identified in [s]ection 201 of the Illinois Domestic Violence Act of 1986 as a 6 According to her presentence investigation report, defendant told the investigating officer, Jayne Mulcrone, that “she was physically and verbally abused by *** co-defendant.” Additionally, defendant’s pro se motion for a reduction of sentence alleged that she “was forced to participate in the crime” and that her “life was at risk,” but it made no mention of codefendant. - 12 - No. 1-17-0310 person protected by that Act”); see also 750 ILCS 60/201(a)(i) (West 2014) (identifying only individuals and minors who are “abused by a family or household member”). Accordingly, the trial court properly denied defendant’s motions to admit codefendant’s past crimes and the victim’s prior out-of-court statements. ¶ 42 The trial court also did not abuse its discretion in refusing to give non-IPI jury instructions on obstruction of justice when defendant was not ultimately charged with that offense and conceded that it was not a lesser included offense of the charged offenses. See People v. Davis, 213 Ill. 2d 459 , 475 (2004) (reviewing a trial court’s decision declining to give a tendered jury instruction for an abuse of discretion). A defendant is not entitled to have the jury instructed on an offense for which she was not charged that is not a lesser included offense of the charged offenses. See People v. Ceja, 204 Ill. 2d 332 , 359 (2003). ¶ 43 In this case, defendant was charged with multiple counts of first degree murder and intentional homicide of an unborn child. Although defendant was initially arrested for obstruction of justice, the indictment did not charge her with that offense and made no reference to that theory of liability, presumably since she confessed her involvement in the victim’s murder. Moreover, defense counsel conceded that obstruction of justice was not a lesser included offense of those charged in this case when he requested the instruction at trial: “I understand it is not a lesser included [offense] of any of the charges that remain.” Thus, we cannot say that the trial court abused its discretion when it refused to instruct the jury on obstruction of justice. ¶ 44 Turning to defendant’s challenge to her murder conviction based the sufficiency of the evidence, we must determine whether, after viewing the evidence in the light most favorable to the prosecution, any rational trier of fact could have found the essential elements of the crime to have been proven beyond a reasonable doubt. People v. Jackson, 2020 IL 124112 , ¶ 64. We will - 13 - No. 1-17-0310 not overturn a criminal conviction unless the evidence is so improbable or unsatisfactory that it creates a reasonable doubt of the defendant’s guilt. Id. Furthermore, the trier of fact is in the best position to judge the credibility of witnesses, resolve conflicts in the evidence, and draw reasonable inferences therefrom; thus, we will not substitute the trier of fact’s credibility assessments with our own. Id. ¶ 45 A person is guilty of the offense of first degree murder when she kills an individual without lawful justification if, in performing the acts which cause the death, she intends to kill or do great bodily harm to that individual or another. 720 ILCS 5/9-1(a)(1) (West 2010). ¶ 46 The record in this case shows that the evidence at trial overwhelmingly supported the jury’s finding of guilt. Most notably, defendant confessed that she was involved in the victim’s murder. Her confession was supported by forensic and DNA evidence, as well as testimony that not only belied her initial story to the police but also described the events that led to victim’s murder in codefendant’s car where she was hiding in the trunk. Given that evidence, the jury in this case certainly could have found that defendant intended to kill the victim and was successful. Accordingly, we conclude that the evidence in this case was sufficient to sustain defendant’s murder conviction. ¶ 47 Last, defendant challenges her discretionary natural life sentence as unconstitutionally excessive. Defendant claims that new scientific evidence concerning brain development in youths and the reasoning set forth in a line of caselaw beginning with the United States Supreme Court decision in Miller v. Alabama, 567 U.S. 460 (2012), which prohibits mandatory life sentences for juveniles who commit murder, should be considered and applied to her specific circumstances as a 19-year-old young adult with no prior convictions. - 14 - No. 1-17-0310 ¶ 48 The State argues, and we agree, that defendant forfeited her as-applied constitutional challenge by not raising it in the trial court. As a result, she has failed to develop an evidentiary record for her claim in the court below, precluding our review. See People v. Harris, 2018 IL 121932 , ¶ 39 (reemphasizing that “a reviewing court is not capable of making an as-applied finding of unconstitutionality in the ‘factual vacuum’ created by the absence of an evidentiary hearing and findings of fact by the trial court”). ¶ 49 On the merits, the State maintains that defendant has not shown that, as-applied to her circumstances, a discretionary life sentence is unconstitutionally excessive because Miller applied only to juvenile offenders and involved constitutional attacks on mandatory life sentences, not discretionary. But cf. Miller, 567 U.S. at 489 (holding that mandatory life sentences without the possibility of parole for juvenile offenders violate the eighth amendment’s ban on cruel and unusual punishment); People v. Buffer, 2019 IL 122327 , ¶ 42 (holding that the juvenile offender’s mandated 40-year sentence was a de facto life sentence in violation of the eighth amendment); People v. Thornton, 2020 IL App (1st) 170677 , ¶ 22 (similar); but see People v. Holman, 2017 IL 120655 , ¶¶ 47-50 (holding that the juvenile offender’s discretionary life sentence did not violate the eighth amendment where the sentencing court considered his youth and its attendant characteristics at the time of sentencing). ¶ 50 Here, defendant did not raise her as-applied constitutional challenge in the trial court. Instead, she argued in her motion to reconsider that the trial court misapplied the sentencing statute in imposing a discretionary life sentence because she was not found guilty of murdering more than one victim since the unborn child’s death was defined as a “homicide.” But cf. 730 ILCS 5/5-8-1(1)(c)(ii) (West 2016) (mandating a term of natural life imprisonment when the defendant is not a juvenile and “is found guilty of murdering more than one victim”). - 15 - No. 1-17-0310 ¶ 51 To the extent defendant argued in her motion to reconsider that her life sentence was “inappropriate for the same reasons” set forth in Miller, this was at best an implied facial challenge to mandatory life sentences for youths even though defendant’s sentence in this case was discretionary. 7 But see People v. Lusby, 2020 IL 124046 , ¶ 33 (addressing Miller, the court stated that “[t]he constitutional flaw with mandatory life sentences is their mandatoriness” but emphasized that Miller “did not foreclosure the possibility of discretionary life sentences for juveniles”). In concluding that defendant’s as-applied challenge is premature, we note that her reply and supplemental briefs are devoid of any response to the State’s forfeiture argument. Accordingly, we decline to remand this matter for an evidentiary hearing. ¶ 52 CONCLUSION ¶ 53 Based on the foregoing, we affirm the judgment of the trial court. ¶ 54 Affirmed. 7 See, e.g., Harris, 2018 IL 121932 , ¶ 38 (stating that a “party raising a facial challenge must establish that the statute is unconstitutional under any possible set of facts”). - 16 - No. 1-17-0310 No. 1-17-0310 Cite as: People v. Thomas, 2020 IL App (1st) 170310 Decision Under Review: Appeal from the Circuit Court of Cook County, No. 11-CR-08111- 02; the Hon. Brian K. Flaherty, Judge, presiding. Attorneys Amy P. Campanelli, Public Defender, of Chicago (Marsha Watt, for Assistant Public Defender, of counsel), for appellant. Appellant: Attorneys Kimberly M. Foxx, State’s Attorney, of Chicago (Alan J. for Spellberg, Mary L. Boland, Tasha-Marie Kelly, Appellee: and Hareena Meghani-Wakely, Assistant State’s Attorneys, of counsel), for the People. - 17 -

2016-07-06 06:30:29.328914+00

This cause was heard upon the record in the trial court. Each error assigned has been reviewed and the following disposition is made: {¶ 1} Appellant, Cluster Homes, Inc., appeals the decision of the Akron Municipal Court, which denied appellant's oral motion to stay trial proceedings in order to pursue arbitration. This Court affirms. I. {¶ 2} Appellant is in the business of constructing homes. Appellant and appellee, Montecalvo Electric, entered into a contract whereupon appellee agreed to wire three homes being constructed by appellant. The contractor/subcontractor agreement the parties signed contained the following arbitration provision: "In the event a dispute between subcontractor and contractor can not be resolved, it will be taken before arbitration as provided by the American Arbitration Association, construction division, in Cleveland or Akron, Ohio." [Sic.] {¶ 3} Appellee states it wired the three homes and received the final approval from the city of Akron building department on one of the homes. Appellee further claims it tried to receive final approval on the remaining two homes, but was denied access by appellant. Appellee subsequently billed appellant for the work it had completed on the three homes and appellant refused to pay the full amount due appellee under the contract. {¶ 4} Appellee filed a complaint against appellant for breach of contract, account, and unjust enrichment. Appellant answered and filed a counterclaim against appellee. Discovery ensued and the trial date for the parties was rescheduled twice over the next several months. When appellant and appellee finally appeared before the court for the first day of trial, appellant made an oral motion for a stay of the proceedings to take the dispute to arbitration. The trial court denied the motion, granted an order denying the stay, and continued the trial. {¶ 5} Appellant timely appealed from this order and sets forth one assignment of error for review. II. ASSIGNMENT OF ERROR {¶ 6} "THE LOWER COURT ABUSED ITS DISCRETION BY DENYING DEFENDANT-APPELLANT, CLUSTER HOMES, INC.'S MOTION TO STAY PURSUANT TO O.R.C. 2711.02." {¶ 7} In its sole assignment of error, appellant argues that the trial court abused its discretion when it denied appellant's motion to stay the trial proceedings pending arbitration between the parties. This Court disagrees. {¶ 8} This Court has held that "[t]he denial of a motion to stay proceedings and refer a matter to arbitration is subject to review only for an abuse of discretion." Jones v. Fred Martin Motor Co., 9th Dist. No. 20631, 2002-Ohio-716, at ¶ 7, citing Harsco Corp. v. CraneCarrier Co. (1997), 122 Ohio App. 3d 406, 410. "An abuse of discretion connotes more than an error of law or judgment, but implies that the judgment can be characterized as unreasonable, arbitrary or unconscionable. When applying the abuse of discretion standard, an appellate court may not substitute its judgment for that of the trial court." (Citations omitted.) Id. {¶ 9} In MGM Landscaping Contractors, Inc. v. Berry (Mar. 22, 2000), 9th Dist. No. 19426, this Court explained parties' ability to waive their right to arbitration: {¶ 10} "The law of Ohio favors arbitration as an alternative method of dispute resolution. Pursuant to R.C. 2711.02, a court may stay trial of an action `on application of one of the parties' if (1) the action is brought upon any issue referable to arbitration under a written agreement for arbitration, and (2) the court is satisfied the issue is referable to arbitration under the written agreement. When a party does not properly raise the arbitration provision of a contract before the trial court, he is deemed to have waived arbitration. {¶ 11} "A plaintiff's waiver may be effected by filing suit. When the opposite party, the potential defendant, is confronted with a filed lawsuit, the right to arbitrate can be saved by seeking enforcement of the arbitration clause. This is done under R.C. 2711.02 by application to stay the legal proceedings pending the arbitration. Failure to move for a stay, coupled with responsive pleadings, will constitute a defendant's waiver." (Citations omitted.) {¶ 12} It is well settled that "`[t]he waiver doctrine was formulated to ensure that an otherwise absolute right to arbitrate must yield, at times, when justified by public policy considerations of judicial economy and detrimental reliance.'" Klatka v. Seabeck (Aug. 9, 2000), 9th Dist. No. 19787, quoting Manos v. Vizar (July 9, 1997), 9th Dist. No. 96CA2581-M. See, also, 98 A.L.R. 3d 767, at 771-773. {¶ 13} This Court has stated that "[a] party's waiver of a right to arbitration `typically requires knowledge of a right to arbitrate and actions inconsistent with that right that usually involve delay and prejudice to the adverse party.'" Klatka, quoting Manos. Accordingly, this Court must focus on whether appellant had knowledge of the arbitration provision in the parties' contract and acted in a manner inconsistent with this right such that it would delay and prejudice appellee to allow arbitration. {¶ 14} In the present case, the contract between the parties contained an arbitration provision. The contract was signed by the parties on September 29, 1999. Appellant had knowledge of this arbitration provision as it was within appellant's personalized contractor/subcontractor agreement forms, which included appellant's name and address preprinted throughout the forms. {¶ 15} In spite of its knowledge of the arbitration provision, appellant acted in a manner inconsistent with its right to seek arbitration, rather than litigation, to resolve its contract dispute. Appellee filed its complaint against appellant on October 24, 2001. On December 4, 2001, appellant filed its answer, along with a counterclaim, through Richard Silver, who signed such as pro se for appellant. Both parties filed extensive discovery, requesting production of documents, interrogatories, and admissions from each other. {¶ 16} Trial was initially set for February 5, 2002. Both parties requested a continuance, and the court reset trial for March 28, 2002. On February 11, 2002, appellee filed a motion to preclude Mr. Silver from pro se representing appellant corporation. The trial court granted the motion on February 25, 2002, precluded Mr. Silver from representing appellant, and ordered all pleadings filed by Mr. Silver be stricken from the record of the case. The date for trial was again postponed to allow appellant time to retain proper legal counsel for the case. {¶ 17} On March 29, 2002, a notice was filed that appellant was represented by legal counsel, and appellant requested additional time to plead to answer appellee's complaint. On April 15, 2002, appellant filed its answer, along with a counterclaim against appellee. The case went before the court for trial on May 30, 2002, at which time appellant orally moved the court to stay the proceedings for the parties to arbitrate their dispute. {¶ 18} Rather than requesting a stay when appellant received appellee's complaint, appellant filed responsive pleadings with its answer and counterclaim against appellee. Appellant engaged in extensive discovery with appellee, requesting information in order to prepare for litigation. Appellant even had a second chance to properly request a stay and not pursue litigation after Mr. Silver was precluded from further representing appellant and appellant's pleadings by Mr. Silver were stricken from the record. Instead, appellant had its new counsel file responsive pleadings with an answer and counterclaim against appellee. Seven months passed from the time appellee filed suit against appellant to the time the parties appeared in court to proceed with trial. Yet appellant did not file any written motion for a stay in the case during this time. Instead, appellant waited until the day of trial to orally request the court for a stay to compel arbitration. {¶ 19} In light of this conduct, it is clear that appellant had knowledge of the arbitration provision and acted in a manner inconsistent with its right to arbitrate the dispute with appellee. Moreover, allowing appellant to waste both appellee's and the trial court's time, money and efforts in preparing for litigation for seven months by granting its motion to stay proceedings on the day of trial would surely be against public policy considerations of judicial economy and detrimental reliance. {¶ 20} Consequently, this Court concludes that appellant waived its right to arbitration when it did not properly raise the arbitration provision before the trial court, but instead actively participated in preparing for litigation of the case. Therefore, this Court cannot find that the trial court abused its discretion by denying appellant's oral motion at trial to stay the trial proceedings pending arbitration between the parties. III. {¶ 21} Accordingly, appellant's sole assignment of error is overruled. The judgment of the trial court is affirmed. WHITMORE, J. CONCUR

2020-12-01 22:04:05.326303+00

http://www.illinoiscourts.gov/Opinions/AppellateCourt/2020/1stDistrict/1171964.pdf

2020 IL App (1st) 171964 No. 1-17-1964 Order filed November 25, 2020 Third Division ______________________________________________________________________________ IN THE APPELLATE COURT OF ILLINOIS FIRST DISTRICT ______________________________________________________________________________ THE PEOPLE OF THE STATE OF ILLINOIS, ) Appeal from the ) Circuit Court of Plaintiff-Appellee, ) Cook County. ) v. ) No. 09 C5 50429 ) EDDIE MYLES, ) Honorable ) Colleen Ann Hyland, Defendant-Appellant. ) Judge, presiding. JUSTICE McBRIDE delivered the judgment of the court, with opinion. Justices Ellis and Burke concurred in the judgment and opinion. OPINION ¶1 Defendant Eddie Myles appeals from the circuit court’s second-stage dismissal of his petition for relief under the Post-Conviction Hearing Act (Act) (725 ILCS 5/122-1 et seq. (West 2012)). On appeal, defendant contends he is entitled to an evidentiary hearing on his claim that trial counsel was ineffective for failing to discover that a witness for the State had pending charges for fraud and bribery and failing to use that information to impeach her. For the following reasons, we reverse and remand. No. 1-17-1964 ¶2 Defendant was charged by information with one count of robbery, predicated on taking money from Maryanne Koll, a person 60 years or older, by using or threatening imminent force. See 720 ILCS 5/18-1 (West 2008). We recount the facts from defendant’s 2010 jury trial only to the extent necessary to resolve the issue on appeal. ¶3 Koll testified that on July 23, 2009, when she was 66 years old, she went to a Jewel grocery store in Countryside and withdrew $200 at a bank located in the store. Koll placed the money in a white envelope inside her purse, which she put in the child seat of her grocery cart. As Koll left the store, defendant ran into her left shoulder and removed the envelope from her purse. Koll yelled, “give me back my money,” “help,” and “I am being robbed.” Defendant fled, throwing the envelope containing Koll’s money on the street. Koll retrieved the envelope of money, and 10 minutes later, police brought defendant to Koll. She identified him as the offender. On cross-examination, Koll testified that she did not notice if defendant had a pharmacy bag or portfolio in his hands. ¶4 Sheila LaRoche testified that she witnessed the robbery, called the police, and pursued defendant with several men. As they approached defendant, he went down on one knee, raised his hands, and said, “I give.” Police took defendant into custody. On cross-examination, LaRoche testified that she did not notice anything in defendant’s hands. ¶5 Countryside police officer Paul Klimek testified that he arrested defendant. On cross- examination, Klimek testified that defendant had drawings with him, but did not recall if defendant was carrying a Jewel bag. Klimek also did not recall whether, after arresting defendant, he brought medication to defendant’s wife at her residence. ¶6 Defendant testified that he had prior convictions for theft and driving under the influence. On the date of the incident, he went to Jewel to pick up his wife’s medication and had his art -2- No. 1-17-1964 portfolio with him. After picking up the medication, he purchased apple turnovers at the self- checkout. As defendant exited the store, he accidentally bumped Koll. Defendant apologized and bent to retrieve some papers that Koll dropped, and Koll started screaming that she was “being robbed.” Defendant denied pushing Koll or removing an envelope from her bag. He stated that he was afraid he would be arrested because he was a black man in a white community in an incident with a white woman. ¶7 Defendant walked away without the envelope, but LaRoche ran past him and told three men to stop him because he had robbed someone. Defendant stopped and asked, “[w]hat are you talking about?” LaRoche said she knew what happened at Jewel and that police were on their way. Defendant denied going down on one knee and stating, “I give.” After defendant’s arrest, he asked Klimek to bring his wife’s medication to her, which Klimek did. ¶8 The jury found defendant guilty of robbery. Defendant filed several pro se posttrial motions, including one alleging ineffective assistance of trial counsel. According to the motion, defendant’s attorneys initially advised him that they had his Jewel receipt and drawing pad, which had been inventoried by the police, and said they would show those items to the jury during closing arguments. When defendant asked to see the receipt and his drawings during a break from trial, one of the attorneys stated that he had subpoenaed Jewel, which did not have a receipt for the transaction. Defendant maintained that counsel lied to him and that if the jurors had seen the receipt and drawing pad, they would know that Koll and LaRoche were lying because they testified that he did not have anything in his hands. At the hearing on the motion, defendant also claimed that if he knew that the receipt and drawing pad were not in court, he would have asked for a continuance rather than going to trial. -3- No. 1-17-1964 ¶9 The trial court denied defendant’s motion, finding that the issues defendant raised related to trial strategy. The court noted that it observed defendant’s attorneys, who were “well prepared,” “diligent,” and “possessed excellent trial skills.” Moreover, the jury had the opportunity to consider evidence of the art portfolio through Klimek’s and defendant’s testimonies. ¶ 10 Following a hearing, the court sentenced defendant to 20 years’ imprisonment as a Class X offender and denied his motion to reconsider sentence. ¶ 11 On direct appeal, defendant argued that the trial court’s inquiry into his pro se claim of ineffective assistance was inadequate, the trial court should have appointed counsel to represent him on his claim, and his sentence was excessive. We affirmed. See People v. Myles, 2013 IL App (1st) 111467-U . ¶ 12 On June 6, 2013, defendant filed a pro se postconviction petition asserting that the State failed to disclose, in violation of Brady v. Maryland, 373 U.S. 83 (1963), that Koll had pending federal charges at the time of the robbery and when she testified against him. Defendant attached copies of Koll’s federal information and a Department of Justice press release about her conviction and sentence. According to the exhibits, Koll was charged with fraud and conspiracy to commit bribery in 2007. Koll, who was authorized by the Illinois Department of Public Health to teach food service sanitation classes and administer state certification exams, allegedly accepted at least $96,930 in return for arranging fraudulent public health certificates for at least 531 individuals. In September 2011, Koll was convicted of conspiracy to commit bribery and sentenced to 30 months’ imprisonment. ¶ 13 The circuit court advanced defendant’s petition for second-stage proceedings and appointed counsel, who filed two supplemental petitions. The supplement, filed on July 31, 2015, -4- No. 1-17-1964 restated defendant’s allegation that the State failed to disclose Koll’s pending federal criminal charges. Defendant attached an affidavit from trial counsel, who averred that the prosecution did not disclose that information and that, had he known, he would have used it to impeach Koll. The supplement filed on June 7, 2016, alleged, in relevant part, that trial counsel was ineffective for failing to investigate Koll’s background where that investigation would have led to information to impeach her credibility. ¶ 14 The State moved to dismiss defendant’s postconviction petition. Relevant here, the State asserted that “mere arrests are impermissible for impeachment,” and thus, defendant could not establish he was prejudiced by trial counsel’s failure to investigate Koll. ¶ 15 On July 28, 2017, the circuit court granted the State’s motion to dismiss defendant’s postconviction petition. Regarding defendant’s Brady claim, the court stated that Koll’s federal charges were immaterial, since that information would not have been admissible at trial as impeachment where the prosecutors were not involved in Koll’s case. Even if the charges were material, the outcome of the trial would not have been different because an independent eyewitness testified against defendant. Regarding the ineffective assistance claim, the court found that there was “not a reasonable probability that the pending federal case would have changed the final result,” and therefore, defendant failed to establish prejudice. ¶ 16 On appeal, defendant argues that he is entitled to an evidentiary hearing on his claim that trial counsel was ineffective for failing to discover Koll’s pending fraud and bribery charges and failing to use that information to impeach her. The State responds that defendant failed to make a substantial showing of ineffective assistance where the proposed impeachment would have been improper and would not have affected the outcome of the trial. -5- No. 1-17-1964 ¶ 17 The Act provides a three-stage mechanism for defendants who allege a substantial violation of constitutional rights at trial. People v. Pendleton, 223 Ill. 2d 458 , 471-73 (2006). At the first stage, the circuit court may dismiss a petition that is “frivolous or *** patently without merit.” 725 ILCS 5/122-2.1(a)(2) (West 2012). At the second stage, “the circuit court must determine whether the petition and any accompanying documentation make a ‘substantial showing of a constitutional violation.’ ” People v. Domagala, 2013 IL 113688 , ¶ 33 (quoting People v. Edwards, 197 Ill. 2d 239 , 246 (2001)). If the defendant makes a substantial showing that his constitutional rights were violated, he is entitled to a third stage evidentiary hearing. Id. ¶ 34. ¶ 18 Here, defendant’s petition was dismissed at the second stage of review. At the second stage, “all well-pleaded facts that are not positively rebutted by the trial record are *** taken as true.” Pendleton, 223 Ill. 2d at 473 . The circuit court may dismiss a petition only if the allegations, “liberally construed in light of the trial record,” cannot support a substantial showing of a constitutional violation. People v. Hall, 217 Ill. 2d 324 , 334 (2005). “The inquiry into whether a post-conviction petition contains sufficient allegations of constitutional deprivations does not require the circuit court to engage in any fact-finding or credibility determinations.” People v. Coleman, 183 Ill. 2d 366 , 385 (1998). Therefore, our review of the dismissal of a postconviction petition at the second stage is de novo. People v. Dupree, 2018 IL 122307 , ¶ 29. ¶ 19 Both the United States and Illinois Constitutions guarantee criminal defendants the right to the effective assistance of counsel. U.S. Const., amends. VI, XIV; Ill. Const. 1970, art. I, § 8. To prevail on a claim of ineffective assistance of counsel, a defendant must demonstrate that counsel’s performance was deficient and that the deficient performance prejudiced the defendant. -6- No. 1-17-1964 Strickland v. Washington, 466 U.S. 668 , 687 (1984). More specifically, a defendant must show that counsel’s performance was objectively unreasonable under prevailing professional norms and that there is a “reasonable probability that, but for counsel’s unprofessional errors, the result of the proceeding would have been different.” Id. at 688, 694 . “[W]hether a failure to investigate the testimony of a potential witness amounts to incompetence depends on the value of the evidence to the case.” People v. Marshall, 375 Ill. App. 3d 670 , 676 (2007) (citing People v. Steidl, 177 Ill. 2d 239 , 256 (1997)). ¶ 20 Cross-examination is the primary method by which a witness’s believability and credibility may be challenged. People v. Blue, 205 Ill. 2d 1 , 12 (2001). Accordingly, the sixth amendment right of confrontation includes the right to cross-examine a witness regarding any fact that would reasonably tend to show that the testimony of the witness might be influenced by bias, interest, or motive. People v. Lucas, 151 Ill. 2d 461 , 491 (1992) (citing People v. Triplett, 108 Ill. 2d 463 , 474 (1985)). The “ ‘exposure of a witness’ motivation in testifying is a proper and important function of the constitutionally protected right of cross-examination.’ ” Triplett, 108 Ill. 2d at 482 (quoting Davis v. Alaska, 415 U.S. 308 , 316-17 (1974)). ¶ 21 While only actual convictions may be used to attack the character of a witness, “ ‘the fact that a witness has been arrested or charged with a crime may be shown or inquired into where it would reasonably tend to show that his [or her] testimony might be influenced by interest, bias or a motive to testify falsely.’ ” (Emphasis omitted.) Id. at 475 (quoting People v. Mason, 28 Ill. 2d 396 , 401 (1963)). The fact that a witness is under investigation or has pending charges may be used to impeach the witness by showing that he or she is motivated to assist the prosecution in order to receive leniency in his or her own case. People v. Godina, 223 Ill. App. 3d 205 , 210 (1991); Triplett, 108 Ill. 2d at 486 (holding that the defendant was “denied his right to confront -7- No. 1-17-1964 the witnesses against him when he was precluded from cross-examining the juvenile witness” as to the fact that the witness was in custody at the time of his testimony and regarding the juvenile delinquency petitions which could have been reinstated against the witness at the time of the defendant’s retrial. “This was *** constitutional error of the first magnitude and no amount of showing of want of prejudice [could] cure it.” (Internal quotation marks omitted.)); People v. Baptiste, 37 Ill. App. 3d 808 , 811-13 (1976) (“[W]here the key prosecution witnesses were on probation at the time of trial and might, therefore, be vulnerable to pressure, either real or imagined,” the trial court’s refusal to allow cross examination on the issue denied the defendant a fair trial. “It was for the jury to decide whether the pending charges against [a witness] provided a further motive to offer false testimony beyond the self-evident interest of a victim of a crime.”). Moreover, it “is not material whether the case pending against the witness involves the same transaction for which the defendant is on trial; an unrelated pending charge is a proper subject for cross-examination.” People v. Kellas, 72 Ill. App. 3d 445 , 453 (1979). “The jury is entitled to know the nature of the criminal charges pending against a witness in order to have complete information so as to be better able to resolve the bias question.” (Internal quotation marks omitted.) People v. Makiel, 358 Ill. App. 3d 102 , 115 (2005). To impeach a witness by showing bias, interest, or motive, the evidence used must not be “remote or uncertain” and “must give rise to the inference that the witness has something to gain or lose by his [or her] testimony.” (Internal quotation marks omitted.) Triplett, 108 Ill. 2d at 475-76 . ¶ 22 In this case, the defense and prosecution presented competing versions of events at trial. Koll testified that defendant ran into her and took an envelope from her grocery cart. Defendant’s testimony, however, was essentially that the incident was a misunderstanding. Defendant testified that he had accidentally bumped into Koll, inadvertently causing her to drop some -8- No. 1-17-1964 papers, and when he attempted to retrieve them for her, Koll began screaming that she was being robbed. Defendant then left the area, as he was afraid of being arrested because he was a black man in a white neighborhood involved in an incident with a white woman. ¶ 23 In the present case, defendant made a substantial showing that trial counsel’s failure to investigate Koll amounted to ineffective assistance. Koll’s credibility was critical to the State’s case, and evidence regarding Koll’s pending fraud and bribery charges is the kind of evidence that would “ ‘reasonably tend to show that h[er] testimony might be influenced by interest, bias or a motive to testify falsely,’ ” as it could have shown that she had an interest or motive to curry sympathy or favor as a crime victim in her case. (Emphasis omitted.) See Triplett, 108 Ill. 2d at 475 . In fact, defense counsel recognized the importance of such evidence in an affidavit attached to defendant’s postconviction petition, in which he averred that had he known that information, he would have used it to impeach Koll, albeit without acknowledging his own shortcomings in failing to investigate her. See People v. Hobson, 2014 IL App (1st) 110585 , ¶ 26 (counsel provided “unreasonable assistance” where he “failed to find and present evidence” regarding favorable treatment two witnesses received after testifying before the grand jury); Steidl, 177 Ill. 2d at 256-57 (the defendant made a substantial showing of ineffective assistance of counsel where the evidence was closely balanced such that the jury’s decision “rested upon its judgment of the credibility of the witnesses that came before it,” and counsel’s “failure to investigate precluded the jury from hearing evidence” tending to discredit the testimony of two key witnesses.). ¶ 24 Although the State argues that there is no indication that federal prosecutors would have granted her leniency, defendant need not show that leniency would have been actually granted, only that Koll may have believed that she could obtain such leniency by being the victim of a -9- No. 1-17-1964 crime. See Triplett, 108 Ill. 2d at 476 (“the defendant need not show before cross-examining a witness as to the witness’ possible bias, interest, or motive that any promises of leniency have been made or any expectations of special favor exist in the mind of the witness. *** [D]efense counsel is entitled to inquire into such promises or expectations whether based on fact or imaginary” (internal quotation marks omitted)); People v. Freeman, 100 Ill. App. 3d 478 , 481 (1981) (“[D]efense counsel need not show beforehand that any promises of leniency have been made or any expectations of special favor exist in the mind of the witness.”). ¶ 25 Moreover, it would not be unreasonable for Koll to believe that she could curry favor in exchange for her cooperation in the case against defendant. The federal sentencing guidelines allow, on motion by the government, a downward departure in sentence for defendants who provide substantial assistance in the investigation or prosecution of another person, which has been held to include assistance to not just federal, but also state authorities. See United States v. Love, 985 F.2d 732 , 735 (3d Cir. 1993) (“[S]everal federal courts of appeals, including this one, have assumed without discussion, that [the sentencing guideline allowing a downward departure upon motion of the government stating that the defendant has provided substantial assistance in the investigation or prosecution of another person who has committed an offense] applies to assistance to state as well as federal authorities.”). ¶ 26 In light of defendant’s version of events—that the situation was merely a misunderstanding—it is also possible that if Koll later realized her mistake, she may have been motivated to maintain an untruthful account fearing prejudice in her case for wrongfully accusing defendant of a crime. In these circumstances, the evidence regarding Koll’s criminal charges for fraud and conspiracy to commit bribery would have been admissible evidence relating to Koll’s credibility. See Freeman, 100 Ill. App. 3d at 482 (where the facts “reasonably - 10 - No. 1-17-1964 warranted the conclusion that [the witness] might have been leniency-motivated to testify against the defendant, *** defense counsel should have been allowed to explore that possibility of cross- examination”). ¶ 27 Accordingly, defendant made a substantial showing that counsel performed deficiently in failing to investigate Koll and cross-examine her on her background, and the deficient performance prejudiced defendant. See Strickland, 466 U.S. at 687 ; Triplett, 108 Ill. 2d at 485-86 (“Every effort must be made to allow a jury to accurately assess a witness’ reliability. We cannot speculate as to how the jury would have viewed [the witness]’s reliability had they known” the relevant evidence.); Kellas, 72 Ill. App. 3d at 454 (“This right to cross-examine a witness about a pending charge against him to show bias cannot be defeated merely because there is other evidence that the witness is biased; nor can it be defeated by a claim of lack of prejudice.” “To say that prejudice can be established only by showing that the cross-examination, if pursued, would necessarily have brought out facts tending to discredit the witness’ testimony would be a denial of one’s right to effective cross-examination.” (Emphases omitted.)); Makiel, 358 Ill. App. 3d at 116 (Where the postconviction petition “raise[d] unanswered questions of fact as to whether the prosecution had leverage over [a witness] justifying defendant’s allegation that [the witness] had a possible bias or motive to fabricate due to the pending *** charge,” those “questions can only be answered by matters outside the record, thereby demonstrating the need for an evidentiary hearing.”). ¶ 28 For the foregoing reasons, we reverse the judgment of the circuit court and remand the cause for an evidentiary hearing. ¶ 29 Reversed and remanded. - 11 - No. 1-17-1964 No. 1-17-1964 Cite as: People v. Myles, 2020 IL App (1st) 171964 Decision Under Review: Appeal from the Circuit Court of Cook County, No. 09-C5- 50429; the Hon. Colleen Ann Hyland, Judge, presiding. Attorneys James E. Chadd, Patricia Mysza, Heidi Linn Lambros, and for Kieran M. Wiberg, of State Appellate Defender’s Office, of Appellant: Chicago, for appellant. Attorneys Kimberly M. Foxx, State’s Attorney, of Chicago (Alan J. for Spellberg, Janet C. Mahoney, and Retha Stotts, Assistant State’s Appellee: Attorneys, of counsel), for the People. - 12 -

2020-01-17 22:01:44.78255+00

Love

' MEMORANDUM OPINION. Love : This proceeding arises from the contention of .the petitioner that the proposed deficiency Of $6,123.92 in income tax for the year 1921 was determined’’by the Commissioner as a result of a second examination of the.petitioner’s accounts for that year, made without the request of the petitioner and without a notice in writing from the Commissioner that such additional inspection was necessary, which the petitioner contends to be ‘in controvention of section 1005 - of the Revenue Act of 19¾⅜. At the hearing held, October 15, 1928, no testimony or evidence of any kind was introduced in support of the petitioner’s contentions, £o. that there is nothing before us Upon which we can base a finding of fact, and the case must be decided upon the pleadings. The petitioner was not present in person at the hearing and, beyond; the mere assertion of. the petitioner’s counsel, there is nothing in the record to show that the petitioning taxpayer protested the second examination; if indeed 'there had been any other preceding it, of which the petitioner o-fiers no proof. Even though we assign .all possible weight to those papers submitted with the petition and which purport to be copies of documents received from, the Commissioner and from the supervising *609internal revenue agent, presumably in New York City, we find no relief for the petitioner. In his letter of March 11, 1926, the Commissioner is represented as extending an invitation to the taxpayer to submit in affidavit form, within the 60-day period allowed for appeal to this Board, “ an explanation of the deductions claimed on your return,” but it does not appear that the taxpayer made any effort to file the affidavit so suggested, or to take advantage in any way of the opportunity afforded to press his contentions before the Commissioner, beyond, perhaps, filing with him a statement dated April 22, 1926, from the supervising internal revenue agent in New York, that “ as a result of an examination of your books and records recently made by a representative from this office, recommendation is being made to the Commissioner of Internal Revenue that your income tax returns for these years ” (i. e., 1920, 1921, 1923, and 1924) “ be accepted as correct and closed as filed.” There is no evidence that such recommendation ever was made or received by the Commissioner, and in any event, it would not be binding upon him, or be admissible as evidence here. So that, giving to the petitioner every consideration possible, we must hold substantially as in the matter of J. S. McDonnell, 6 B. T. A. 685, to which, on this point, this case is very closely analogous, that the Commissioner’s failure to comply with section 1005 of the Revenue Act of 1924, by notifying the taxpayer in writing that an additional inspection of his accounts was necessary, may not be interposed as a defense invalidating the deficiency determined upon information derived partly or altogether from other sources where, so far as the record shows, such inspection was made without objection by the taxpayer. Judgment will be entered for the respondent.

2020-01-17 22:01:46.342259+00

Green

*836OPINION. GReen: In the computation of the gain or loss resulting to the estate from the sale of the real and personal property above *837enumerated, tlie Commissioner used as the basis for such computation the value of the property at the date of the decedent’s death. The petitioner accepted as correct the values of these properties thus used by the respondent but contends that the cost to the decedent, or in case the property was acquired prior to March 1, 1913, the value on that date, should be used as the basis in the computation of the gain or loss instead of the value at the date of the decedent’s death. The return filed by the petitioner was not in accordance with the regulations in force at the time and section 702 of the Revenue Act of 1928 is accordingly inapplicable. The question .is precisely that which we had before us in Appeal of Straight, Executrix, 7 B. T. A. 177, wherein we held that the basis, for the computation of gain or loss resulting from the sale of property of an estate by an executor is the value at the date of acquisition by the estate if that date be subsequent to March 1, 1913. We find no occasion to depart from that rule. As regards the second issue, there is no dispute as to the fact that the executor paid, for and on behalf of the estate, the amounts set forth in our findings. The beneficiaries of the estate were the executor (the petitioner herein), his father, and two brothers. None of these claimed any part of the amounts thus paid as deductions on their returns for any year. It also appears that the petitioner herein has not claimed the amounts paid as a deduction on any return filed for and on behalf of the estate of which he is the executor. The petitioner claims that it falls squarely within section 703 of the Revenue Act of 1928: Sec. 703. Deduction oj? estate and inheritance taxes — retroactive. (a) In determining tlie net income of an heir, devisee, legatee, distributee, or beneficiary (hereinafter in this section referred to as “beneficiary”) or of an estate for any taxable year, under the Revenue Act of 1926 or any prior revenue Act, the amount of estate, inheritance, legacy, or succession taxes paid or accrued within such taxable year shall be allowed as a deduction as follows: (1) If the deduction has been claimed by the estate, but not by the beneficiary, it shall be allowed to the estate; (2) If the deduction has been claimed by the beneficiary, but not by the estate, it shall be allowed to the beneficiary; (3) If the deduction has been claimed by the estate and also by the beneficiary, it shall be allowed to the estate (and not to the beneficiary) if the tax was actually paid by the legal representative of the estate to the taxing authorities of the jurisdiction imposing the tax; and it shall be allowed to the beneficiary (and not to the estate) if the tax was actually paid by the beneficiary to such taxing authorities; (4) If the deduction has not been claimed by the estate nor by the beneficiary, it shall be allowed as a deduction only to the person (either the estate or the beneficiary) by whom the tax was paid to such taxing *838authorities, and only if a claim for refund or credit is filed within the period of limitation properly applicable thereto; (5) Notwithstanding the provisions of paragraphs (1), (2), (3), and (4) of this subsection, if the claim of the deduction by the estate is barred by the statute of limitations, but such claim by the beneficiary is not so barred, the deduction shall be allowed to the beneficiary, and if such claim by the beneficiary is barred by the statute of limitations, but such claim by the estate is not so barred, the deduction shall be allowed to the estate. (b) As used in this section, the term “ claimed ” means claimed— (X) In the return; or (2) In a claim in abatement filed in respect of an assessment made on or before June 2, 1924. (c) This section shall not affect any case in which a decision of the Board of Tax Appeals or any court has been rendered prior to the enactment of this Act [Revenue Act of 1928], whether or not such decision has become final. Subparagraphs (1), (2), and (3) of paragraph (a) interpreted in the light of the definition in paragraph (b), are applicable only where the deduction has been claimed “ in the return,” or “ in a claim in abatement filed in respect of an assessment made on or before June 2, 1924.” Subparagraph (4) of paragraph (a) provides for the allowance of the deduction in cases where “ a claim for refund or credit ” has been filed. This petitioner has not claimed the deduction in a return or in a claim for abatement, refund, or credit, and since to come within the section a claim must have been made within one of the four ways, it follows that his right, if any, to the deduction must rest upon other provisions of the statute. See Keith v. Johnson, 271 U. S. 1. Section 219 of the Revenue Act of 1921 provides that the tax imposed by sections 210 and 211 of that same Act shall apply to the income of estates. In the computation of net income upon which the tax imposed by sections 210 and 211 is computed, the taxpayer, in this instance the estate, is permitted by section 214(a) (3) of the same Act to deduct “ taxes paid or accrued within the taxable year,” with certain exceptions not here material. We held in Robert M. Green, Jr., 12 B. T. A. 1046, that inheritance taxes paid by the estate to the Commonwealth of Pennsylvania might be by it deducted in the computation of its net income for the year paid. Our holding as to the States of Connecticut, West Virginia, and New Jersey is to the same effect. See Prescott et al., Executors, 8 B. T. A. 582, and Frost et al., Executors, 12 B. T. A. 1295. It follows from these decisions that the petitioner in computing its net income for the year 1923 is entitled to deduct the inheritance, succession, and transfer taxes which we have found to have been paid in that year. Reviewed by the Board. Judgment will be entered wider Rule 50. Van Fossan dissents on the first point.

2020-01-17 22:01:46.376147+00

Milliken

*847OPINION. Milliken: Petitioners do not now contend that respondent erred in including for estate-tax purposes the entire value of the community property in the gross estate of David Neustadter, deceased. Neither do they now raise any question as to the amount of the deficiency. See Estate of Isidore Rosenberg, 14 B. T. A. 1840, and cases therein cited. They admit that the determination of such a deficiency would be unobjectionable in a proper case. They, however, vigorously contend that since, as they assert, they have distributed the whole of the estate to the various devisees and legatees, they and each of them would have incurred a personal liability for the deficiency but for the fact that they have been, as they contend, relieved from such liability by reason of the letter of July 30,1924 (written by Newton H. Neustadter, as executor) to respondent and the subsequent correspondence between them, and by reason of the payment by them prior to the receipt of the deficiency letter upon which this proceeding is based of the whole tax then determined against them. They assert that since said deficiency letter was addressed to them as executors, respondent has determined they are personally liable for the deficiency, and further assert that, since they have been released from all personal liability and since as they now have in their hands no assets of the estate from which payment can be made, the Board should determine that there is no deficiency as against them. The contention that they have been released of personal liability is based upon section 313 of the Revenue Act of 1924. That section reads: Seo. 313. (a) The collector shall grant to the person paying the tax duplicate receipts, either of which shall be sufficient evidence of such payment, and shall entitle the executor to be credited and allowed the amount thereof by any court having jurisdiction to audit or settle his accounts. (b) If the executor makes written application to the Commissioner for determination of the amount of the tax and discharge from personal liability therefor, the Commissioner (as soon as possible, and in any event within one year after the making of such application, or, if the application is made before the return is filed, then within one year after the return is filed, but not after the expiration of the period prescribed for the assessment of the tax in section 310) shall notify the executor of the amount of the tax. The executor, upon payment of the amount of which he is notified, shall he discharged from personal liability for any deficiency in tax thereafter found to be due and shall be entitled to a receipt or writing showing such discharge. *848(c) The provisions of subdivision (b) shall not operate as a release of any part of the gross estate from the lien for any deficiency that may thereafter be determined to be due, unless the title to such part of the gross estate has passed to a bona fide purchaser for value, in which case such part shall not be subject to a lien or to any claim or demand for any such deficiency, but the lien shall attach to the consideration received from such purchaser by the heirs, legatees, devisees, or distributees. See also section 407 of the Revenue Act of 1921. Respondent asserts that petitioners have not complied with the above sections and for the reason these provisions have no application. Respondent further contends that the question of personal liability on the part of the executors is not involved in this proceeding. This latter contention, we think, is the controlling issue. In this connection, it is to be noted that the decree of the Superior Court entered in February, 1924, recites that petitioners had in their hands the sum of $10,000, which they were to hold until they had received a full acquittance from the United States Government with respect to all United States taxes claimed or to be claimed against the estate of David Reustadter, deceased. Petitioner contends that since it is shown that they had paid the deficiency determined by the letter of October 14,1925, as redetermined by the letter of November 10, 1925, we must assume that petitioners have distributed the said amount to the persons entitled as required by the decree. Respondent does not assent to this contention. It is also pertinent to note that petitioners have not been discharged from their office and are now proceeding in this appeal in their executorial capacity and not as individuals. Whether the issue of personal liability is before us depends on •what respondent has determined in his letter of September 21, 1926, which is the basis of this proceeding. That letter is addressed to “Newton H. Neustadter, et al., Executors, Estate of David Neu-stadter.” A careful reading of the letter of September 21, 1926, discloses that there is nothing in that letter which refers to any personal liability on the part of the executors. It asserts only a “ deficiency ” in estate tax. It is further most important to note that the letter was written pursuant to section 318 of the Revenue Act of 1926, and informs petitioners of their right under section 308 to appeal to the Board. The pertinent part of section 318 reads: If after the enactment of this Act the Commissioner determines that any assessment should be made in respect of any estate or gift tax imposed by the Revenue Act of 1917, the Revenue Act of 1918, the Revenue Act of 1921, or the Revenue Act of 1924, or by any such Act as amended, the Commissioner is authorized to send by registered mail to the person liable for such tax notice of the amount proposed to be assessed, which notice shall, for the purposes of this Act, be considered a notice under subdivision (a) of section 308 of this Act. * * ». As shown by the above excerpt, this section applies to both estate and gift taxes and the requirement is that the registered letter be *849mailed “ to the person liable for such tax * * *.” By section 406 of the Revenue Act of 1921 it is provided: “ The executor shall pay the tax to the collector or deputy collector * * By section 400 of the same Act it is provided: The term “ executor ” means the executor or administrator of the decedent, or, if there is no executor or administrator, any person in actual or constructive possession of any property of the decedent; * * * Since the executors were then (and now are) in office, the plain requirement of the statute is that the deficiency letter be addressed to them. It is only where “ there is no executor or administrator ” that the letter may be addressed to “ any person in actual or constructive possession of any property of the decedent.” It is a further requirement of section 318 of the Revenue Act of 1926 that said notice “ shall for the purpose of this Act be considered a notice under subdivision (a) of section 308 of this Act.” Turning to subdivision (a) of section 308, we find that it contains the following: If the Commissioner determines that there is a deficiency in respect of the tax imposed by this title, the Commissioner is authorized to send notice of such deficiency to the executor by registered mail. Within 60 days after such notice is mailed (not counting Sunday as the sixtieth day), the executor may file a petition with the Board of Tax Appeals for a redetermination of the deficiency. * ⅜ * The definition of the term “ executor ” in section 300 of the Revenue Act of 1926 ,is the same as that in section 400 of the Revenue Act of 1921. It thus appears that respondent could have determined a deficiency in estate tax under section 308 against the estate of David Neustadter, deceased, in no way other than by addressing his letter to the executors then in office. If petitioners’ contention be followed to its logical conclusion, it would result that it matters not that the estate was liable for the tax, whether in the hands of the executors or in the hands of the .devisees or legatees, no deficiency under section 308 could be determined in a case like this where the executors are still in office. We do not concur in such a contention. Upon an appeal under section 308 of the Revenue Act of 1926, the jurisdiction of the Board is limited to a redetermination of a deficiency in estate tax due from the executors in their representative capacities. However, in redetermining such a deficiency, the Board is not limited to a mere recomputation, but may determine that there is no deficiency on the ground that the deficiency is barred by the statute of limitations (section 906(e)), or because it is illegal in that it violates the provisions of any of the revenue acts or for any other reason. National Refining Co. of Ohio, 1 B. T. A. 236. We have approved the deficiency asserted by respondent against the executors in their representative capacities, and in so doing, we are *850of opinion that we have exhausted our jurisdiction in so far as this proceeding is concerned. In approving the deficiency we have not decided whether the additional tax shall be paid by the executors as their personal liability. This view is in accord with the decision of the United States District Court for the Eastern District of Pennsylvania in United States v. Rodenbough, 21 Fed. (2d) 781, where the court said: One other matter remains to be disposed of. The defendant argued that, under the limitation provision of section 407 of the Revenue Act of 1921 (Comp. St. § 6336¾ h), this action against the defendant is barred. The discharge from liability provided for by that statute, however, is a discharge from personal liability. This action is not against the executor personally, but against him in his representative capacity as executor of the estate. A judgment rendered in this action would not subject him directly to any personal liability. If for any reason, as a result of the judgment in this case, recourse against the executor in his personal capacity should be attempted, the question could then be raised. As the record stands at present, it is not involved. This portion of the opinion of the District Court was affirmed by the Circuit Court of Appeals in Rodenbough, v. United States, 25 Fed. (2d) 13. Respondent can determine the personal liability of an executor only under section 316 of the Revenue Act of 1926, the pertinent parts of which read: Seo. 316. (a) The amounts of the following liabilities shall, except as hereinafter in this section provided, be assessed, collected and paid in the same manner and subject to the same provisions and limitations as in the case of a deficiency in a tax imposed by this title (including the provisions in case of delinquency in payment after notice and demand, the provisions authorizing distraint and proceedings in court for collection, and the provisions prohibiting claims for suits for refunds) : (1) The liability, at law or in equity, of a transferee of property of a decedent or donor, in respect of the tax (including interest, additional amounts, and additions to the tax provided by law) imposed by this title or by any prior estate tax Act or by any gift tax Act. ■ (2) The liability of a fiduciary under section 3467 of the Revised Statutes in respect of the payment of any such tax from the estate of the decedent or donor. Any such liability may be either as to the amount of tax shown on the return or as to any deficiency in tax. Thus we find that the Revenue Act of 1926 contains a distinctively separate provision for the redetermination of “ The liability of a fiduciary under Section 3467 of the Revised Statutes * * Section 3467 of the Revised Statutes reads: Every executor, administrator, or assignee, or other person, who pays any debt due by the person or estate from whom or for which he acts, before he satisfies and pays the debts due to the United States from such person or estate, shall become answerable in his own person and estate for the debts so due to the United States, or for so much thereof as may remain due and unpaid. *851Three things are to be noted at this juncture: First, petitioners are asserting their release from the personal liability created by section 3467 of the Revised Statutes; second, that the liability under this section can be asserted by respondent only under section 316 of the Revenue Act of 1926; and, third, that section 316 is distinct from and exclusive of sections 308 and 318 of the Revenue Act of 1926. We are' of opinion that we can not under a proceeding based on a deficiency letter issued under sections 308 and 318 determine a “liability ” under section 316. All we determine is that the executors in their representative capacities are liable for the deficiency determined by respondent. We hold that where our jurisdiction is based upon a deficiency letter written pursuant to sections 308 and 318, and which determines only a “ deficiency ” in estate tax, we have no jurisdiction to decide the question of the “ liability” of a fiduciary under section 3467 of the Revised Statutes. Since respondent has proceeded under sections 308 and 318; since he has determined only a deficiency in estate tax against the executors in their representative capacities, and since he has determined no personal liability on the part of the executors under section 3467 of the Revised Statutes, we are of opinion that we exhaust our jurisdiction as concerns this proceeding when we approve the deficiency as determined by respondent. Reviewed by the Board. Judgment will be entered for resyondent. Steeni-iagen concurs in the result.

2020-12-01 22:08:34.271457+00

https://juddocumentservice.mt.gov/getDocByCTrackId?DocId=338421

12/01/2020 DA 18-0487 Case Number: DA 18-0487 IN THE SUPREME COURT OF THE STATE OF MONTANA 2020 MT 302N STATE OF MONTANA, Plaintiff and Appellee, v. RAYMOND VANDENBOS, Defendant and Appellant. APPEAL FROM: District Court of the Ninth Judicial District, In and For the County of Glacier, Cause No. DC 17-52 Honorable Robert G. Olson, Presiding Judge COUNSEL OF RECORD: For Appellant: Chad Wright, Appellate Defender, Lisa S. Korchinski, Assistant Appellate Defender, Helena, Montana For Appellee: Timothy C. Fox, Montana Attorney General, Katie F. Schulz, Assistant Attorney General, Helena, Montana Terryl T. Matt, Glacier County Attorney, Joseph F. Sherwood, Deputy County Attorney, Cut Bank, Montana Submitted on Briefs: November 4, 2020 Decided: December 1, 2020 Filed: r--6ta•--df __________________________________________ Clerk Justice Ingrid Gustafson delivered the Opinion of the Court. ¶1 Pursuant to Section I, Paragraph 3(c), Montana Supreme Court Internal Operating Rules, this case is decided by memorandum opinion and shall not be cited and does not serve as precedent. Its case title, cause number, and disposition shall be included in this Court’s quarterly list of noncitable cases published in the Pacific Reporter and Montana Reports. ¶2 Defendant and Appellant Raymond Vandenbos (Vandenbos) was arrested and charged with driving under the influence (DUI), 4th or subsequent offense. On July 31, 2017, Montana Highway Patrol Trooper Terrance Melton was advised by Blackfeet Tribal Police of a possible drunk driver on the Starr School Road and was provided the make, color, and license plate number of the vehicle. The license plate number returned to a red 1981 Chevrolet pickup registered to Vandenbos. As Trooper Melton entered the Starr School area, he observed the vehicle parked on the right side of the westbound lane. As he drove past the vehicle, the driver’s side door was open and Vandenbos (whom he later identified) was sitting in the driver’s seat. Trooper Melton turned on his overhead lights and turned around, before pulling in behind the vehicle. Vandenbos exited the driver’s side and, as instructed by Trooper Melton, walked to the rear of the truck. Trooper Melton observed Vandenbos had bloodshot, watery eyes, slurred speech, a strong odor of alcohol emanating from him, and was unsteady on his feet. Trooper Melton asked Vandenbos where the keys to the vehicle were and Vandenbos removed them from his right front pocket and handed them to Trooper Melton. Vandenbos refused to participate in any field 2 sobriety tests or a blood test, but did agree to take a preliminary breath test. Trooper Melton then obtained a search warrant for a blood draw, which showed a BAC of .199. ¶3 At trial, Vandenbos moved for directed verdict following the State’s case-in-chief, asserting the State failed to prove Vandenbos was in “actual physical control” of the vehicle. The District Court denied the motion and the jury ultimately found Vandenbos guilty of the DUI offense. On June 6, 2018, the District Court then sentenced Vandenbos to five years with the Montana Department of Corrections (DOC). On appeal, Vandenbos asserts the District Court did not have sufficient evidence to determine beyond a reasonable doubt that Vandenbos was in actual physical control of his vehicle while under the influence of alcohol. The basis for this assertion is that there were other individuals who could have potentially driven the vehicle, the vehicle was not running when Trooper Melton encountered it, and Trooper Melton did not actually see Vandenbos driving the vehicle. Vandenbos also contends the District Court erred by not crediting him with 311 days of pretrial incarceration. ¶4 We review de novo a question on the sufficiency of the evidence to determine whether, after reviewing the evidence in a light most favorable to the prosecution, any rational trier of fact could have found the essential elements of the offense beyond a reasonable doubt. State v. Sommers, 2014 MT 315 , ¶ 15, 377 Mont. 203 , 339 P.3d 65 (citing State v. Redlich, 2014 MT 55 , ¶ 18, 374 Mont. 135 , 321 P.3d 82 ). ¶5 Section 61-8-401(1)(a), MCA, provides that it is unlawful for “a person who is under the influence of . . . alcohol to drive or be in actual physical control of a vehicle upon the ways of this state open to the public[.]” 3 ¶6 Vandenbos’s argument he was not in possession of the vehicle is unpersuasive and the District Court did not err in paying no heed to this argument. Trooper Melton received a report of a possible drunk driver on the Starr School Road and was provided the make, color, and license plate number of the vehicle. Shortly thereafter he located the exact vehicle on Starr School Road with its occupants still in the vehicle. He witnessed Vandenbos in the driver’s seat and immediately upon exiting the vehicle, Vandenbos had the keys to the vehicle in his pocket. This combined with the direct and circumstantial evidence of intoxication at the time of the arrest is reasonable and sufficient evidence to support a conviction for DUI. ¶7 Vandenbos also contests the District Court’s failure to credit him for 311 days of pretrial incarceration. Vandenbos was arrested on July 31, 2017. On August 16, 2017, Vandenbos was charged by information with the DUI offense and simultaneously the court issued an arrest warrant and set bond on the DUI offense at $20,000. The DUI offense was a bailable offense. Vandenbos never posted any bond on this offense and thus was arguably being held on the DUI offense regardless of whether he was also being held on a different offense. The record contains a February 21, 2018 letter to Vandenbos from Kevin Olson, administrator of DOC’s Probation and Parole Division, which states, in pertinent part: In October of 2017 you filed a disciplinary appeal with Bureau Chief Lahiff. She responded by denying your appeal and correctly pointing out that your current placement in the Glacier County Detention Facility is due to your pending Driving While Under the Influence criminal charges filed by the Glacier County Attorney’s Office. The Location Report contained in the record shows Vandenbos was placed on “Conditional Release Hold” on July 31, 2017, when he was arrested on the DUI offense and that hold 4 ended on August 3, 2017, and he was not further placed on a conditional release prior to June 6, 2018, when he was sentenced on the DUI in this cause. This documentation clearly indicates Vandenbos was being held only on the DUI charge and was no longer on a conditional release hold as of August 3, 2017. Each day of incarceration on a bailable offense must be credited against a defendant’s sentence when directly related to the offense for which the sentence was imposed. Section 46-18-403(1), MCA; State v. Hornstein, 2010 MT 75 , ¶¶ 14, 16, 356 Mont. 14 , 229 P.3d 1206 . Here, Vandenbos is thus entitled to credit for the time he served between his arrest and sentencing. The District Court’s determination of the number of days Vandenbos is entitled to credit for pretrial incarceration is reversed and this matter is remanded to the District Court to provide Vandenbos credit for pretrial incarceration in conformance with this Opinion. ¶8 We have determined to decide this case pursuant to Section I, Paragraph 3(c) of our Internal Operating Rules, which provides for memorandum opinions. In the opinion of the Court, the case presents a question controlled by settled law or by the clear application of applicable standards of review. ¶9 Affirmed in part, reversed in part, and remanded for further action consistent with this Opinion. /S/ INGRID GUSTAFSON We concur: /S/ DIRK M. SANDEFUR /S/ LAURIE McKINNON /S/ BETH BAKER /S/ JAMES JEREMIAH SHEA 5

2020-12-01 22:08:53.946972+00

https://juddocumentservice.mt.gov/getDocByCTrackId?DocId=338404

12/01/2020 DA 19-0590 Case Number: DA 19-0590 IN THE SUPREME COURT OF THE STATE OF MONTANA 2020 MT 301N APRIL ARMSTRONG, DAVID R. BARNHILL, K. AMY PFEIFER, PEGGY PROBASCO, and PATRICK QUINN, Petitioners and Appellees, v. BOARD OF PERSONNEL APPEALS, MONTANA DEPARTMENT OF ADMINISTRATION, MONTANA DEPARTMENT OF PUBLIC HEALTH AND HUMAN SERVICES, Respondents and Appellants. APPEAL FROM: District Court of the First Judicial District, In and For the County of Lewis and Clark, Cause No. DDV-2017-732 Honorable James P. Reynolds, Presiding Judge COUNSEL OF RECORD: For Appellants: Timothy C. Fox, Montana Attorney General, Jeffrey M. Doud, Assistant Attorney General, Department of Justice Agency Legal Services Bureau, Helena, Montana Matthew R. Mitchell, Special Assistant Attorney General, Montana Department of Administration, Helena, Montana For Appellees: Linda M. Deola, Morrison Sherwood Wilson & Deola, PLLP, Helena, Montana  Submitted on Briefs: October 28, 2020 Decided: December 1, 2020 Filed: cir-641.—if __________________________________________ Clerk 2 Justice Jim Rice delivered the Opinion of the Court. ¶1 Pursuant to Section I, Paragraph 3(c), Montana Supreme Court Internal Operating Rules, this case is decided by memorandum opinion and shall not be cited and does not serve as precedent. Its case title, cause number, and disposition shall be included in this Court’s quarterly list of non-citable cases published in the Pacific Reporter and Montana Reports. ¶2 The Montana Department of Administration, State Human Resource Division and the Department of Public Health and Human Services (Department), appeal from the order entered by the First Judicial District Court, Lewis and Clark County, reversing the Board of Personnel Appeals (Board) and remanding the case to the Board with instructions to remand to a hearing officer for proper application of the factors within § 2-18-301(4), MCA (2015). We affirm, restating the issues as follows: 1. Did the District Court have jurisdiction to undertake review of the decision of the Board? 2. Did the Board’s adoption of the Hearing Officer’s Second Recommended Order, which was predicated on a perceived directive from the Board, violate the due process rights of Appellees? ¶3 April Armstrong, David R. Barnhill, K. Amy Pfeifer, Peggy Probasco, and Patrick Quinn (Appellees) are attorneys within the Child Support Enforcement Division (CSED) of the Department. The Department employed other attorneys in its Office of Legal Affairs (OLA). The CSED and OLA attorneys, other than those with managerial duties, were classified at Band 7 in the Broadband Classification and Pay Plan System, and shared an identical job code. 3 ¶4 While the attorney positions in both offices shared a job code, they were assertedly differentiable. OLA attorneys worked in the director’s office and had certain Band 8 level non-predominant duties. OLA attorneys were tasked with responding to requests from the director and aiding multiple Department divisions. These responsibilities required an ostensibly broader array of expertise for OLA attorneys. ¶5 Beginning in April 2011, Appellees individually made written and verbal requests of the Department of Public Health and Human Services seeking an explanation of the pay disparity, and sought pay parity among the attorneys in the two offices. The requests largely went unanswered. In January 2012, Appellees filed a complaint in District Court. However, because Appellees had failed to exhaust all available administrative remedies, the District Court dismissed and remanded the cause to the Board in July 2012. During the time the complaint was pending before the District Court, both Appellees and OLA attorneys received market pay adjustments pursuant to a directive from the Governor. Two of the individual Appellees, Barnhill and Quinn, received additional market pay increases that brought their salary up to 80% of the Department’s adopted pay range. During the market adjustment process, the assistant human resource director for the Department of Public Health and Human Services recommended that the pay for OLA attorneys be approximately 5% higher than the rate of pay for CSED attorneys. ¶6 Appellees filed a Step I grievance in June 2014, ultimately requesting a hearing. The Board assigned a Hearing Officer, who conducted a three-day contested evidentiary 4 hearing from March 31 to April 2, 2015, after which the parties submitted proposed decisions and briefing. ¶7 In October 2015, the Hearing Officer held a telephone conference with the parties to discuss the relevance of Mashek v. DPHHS, Grievance No. 1-2013, Case No. 289-2013, which at that time was pending on appeal to this Court. At issue in Mashek was the interpretation of § 2-18-301(4), MCA, as related to compensation of union employees of the State. See Mashek v. DPHHS, 2016 MT 86 , ¶ 3, 383 Mont. 168 , 369 P.3d 348 . The Mashek hearing officer had issued a recommended order holding that the claimants therein had been aggrieved by receiving pay that was not internally equitable. Mashek, ¶ 6. Upon review, the Board had rejected the recommended order, reasoning the claimants had no independent right to internally equitable pay, but, rather, internal equity was merely one factor to be considered, along with competitiveness and competency, during the collective bargaining process. Mashek, ¶ 6. Upon judicial review, the District Court had reversed the Board’s order, agreeing with the hearing officer’s initial conclusion that claimants were entitled to pay that was internally equitable with other employees of the same title and pay band. Mashek, ¶ 7. ¶8 The Hearing Officer in this case apparently relied on the district court’s interpretation of the statute in Mashek in issuing his first Findings of Fact, Conclusions of Law, and Recommended Order (First Recommended Order) in February 2016. The First Recommended Order held the Appellees were aggrieved solely by receiving pay that was not internally equitable as compared to the other Band 7 attorneys within the Department, 5 and required that the average base pay for OLA attorneys could not exceed 105% of that of CSED attorneys, ostensibly in reliance of the 2012 recommendation of the Department’s assistant human resource director. The order proposed a retroactive effective date of June 25, 2014, the date Appellees filed their Step I grievance. ¶9 Both parties submitted objections to the First Recommended Order and oral arguments were heard by the Board on September 16, 2016. However, in April 2016, this Court reversed the district court’s decision in Mashek, on which the Hearing Officer had based his First Recommended Order. Mashek v. DPHHS, 2016 MT 86 , 383 Mont. 168 , 369 P.3d 348 . We determined the pay factors in § 2-18-301(4), MCA—competency, internal equity, and competitiveness—did not constitute stand-alone rights but were instead factors to be considered and weighed equally against one another. Mashek, ¶¶ 12, 15. In response, the Board remanded the matter to the Hearing Officer to reconsider the issue in light of the Mashek holding (Order of Remand). In its deliberations, the Board noted that “it could play out that the hearing officer that applies [the three statutory factors] could send a recommended order back that” reached the same conclusion as the First Recommended Order. In the Order of Remand, the Board instructed the Hearing Officer to consider the “totality of circumstances in weighing all three factors” articulated in § 2-18-301(4), MCA, and to give “[p]roper regard . . . to the employer’s decisions concerning pay disparities unless such decisions appear to be factually unsupported.” The Appellees did not appeal the Board’s Order of Remand. 6 ¶10 In May 2017, the Hearing Officer issued a second Findings of Fact, Conclusions of Law, and Recommended Order (Second Recommended Order), reaching a determination that Appellees had not been aggrieved and were entitled to no backpay. The Hearing Officer expressed hostility toward the Board’s Order of Remand, indicating he felt directed to credit evidence from the Department and produce an outcome favorable to the Department. Approximately one-half of the Second Recommended Order dealt with the Hearing Officer’s concerns about the perceived directive from the Board. ¶11 Undertaking review of the Second Recommended Order upon objections, the Board expressed dismay regarding the Hearing Officer’s perceptions of the remand order, but elected to proceed by adopting the Second Recommended Order’s factual findings, legal conclusions, and ultimate recommendation, while deleting the disparaging discussion. The Board’s Final Agency Decision was entered on August 25, 2017. On September 20, 2017, the Appellees timely petitioned for judicial review of the Board’s Final Agency Decision, and the District Court received briefing and oral argument. ¶12 On August 12, 2019, the District Court reversed the Board’s adoption of the Second Recommended Order and remanded to the Board with instructions to remand the matter back to a hearing officer to correctly apply all three § 2-18-301(4), MCA, factors in light of our decision in Mashek, and to consider whether “intervening administrative changes within DPHHS” impact the decision. The District Court reasoned the Board’s action on the Hearing Officer’s orders “substantially affected the rights of the [Appellees] to a fair and impartial hearing.” The Department appeals. 7 ¶13 A district court’s review of an agency’s findings is limited to a review of the record. Section 2-4-704(1), MCA. A district court may not substitute its judgment for that of the agency for determining weight of the evidence for questions of fact, but it may reverse or modify the agency decision if substantial rights have been prejudiced. Section 2-4-704(2), MCA. This standard of review applies not only to a district court’s review of the agency’s decision, but to our subsequent review of the district court’s decision on appeal. Blaine Cnty. v. Stricker, 2017 MT 80 , ¶ 16, 387 Mont. 202 , 394 P.3d 159 (citing In re Transfer of Ownership & Location of Mont. All-Alcoholic Bevs. License No. 02-401-1287-001, 2007 MT 192 , ¶ 6, 338 Mont. 363 , 168 P.3d 68 ). “We review an order from a district court acting in an appellate capacity to determine whether the district court reached the correct conclusions under the appropriate standards of review.” Mashek, ¶ 8 (citation omitted). This court exercises plenary review for constitutional questions. State v. Stock, 2011 MT 131 , ¶ 16, 361 Mont. 1 , 256 P.3d 899 (citing State v. Norquay, 2011 MT 34 , ¶ 13, 359 Mont. 257 , 248 P.3d 817 ). All other legal conclusions are questions of law subject to de novo review. Dick Irvin Inc. v. State, 2013 MT 272 , ¶ 18, 372 Mont. 58 , 310 P.3d 524 (citing In re J.D.N., 2008 MT 420 , ¶ 8, 347 Mont. 368 , 199 P.3d 189 ). ¶14 As a threshold matter, the Department argues the District Court lacked jurisdiction over the Board’s Order of Remand because the Appellees failed to timely appeal that order. Section 2-4-702(2)(a), MCA, requires that an aggrieved party file a petition in district court within 30 days of the final agency decision to preserve their right to appeal. The Department cites Whitehall Wind, LLC v. Mont. PSC, 2010 MT 2 , 355 Mont. 15 , 223 P.3d 8 907. There, Whitehall Wind argued the Public Service Commission could not appeal from a district court’s order of remand because it was not yet a final order. Whitehall Wind, ¶ 17. We held the appeal was permissible, reasoning a district court’s order of remand was a final order for purposes of appeal. Whitehall Wind, ¶ 18. However, that rationale does not apply equally to the remand order issued here by the Board. The language of the statute requires appeals to be brought “within 30 days after [] the final written decision of the agency[.]” Section 2-4-702(2)(a), MCA (emphasis added). When the Board remanded this matter to the Hearing Officer, the matter was still pending within the agency. A final agency decision was not rendered until the Board issued its “Final Agency Decision” following the Hearing Officer’s Second Recommended Order. We conclude the District Court had jurisdiction to hear the matters raised in the petition for judicial review. ¶15 The Department next argues that the District Court “erred in its interpretation and conclusions about [the Board’s] Order of Remand because nothing therein directed the hearing[] examiner how to weigh the evidence or to defer to DPHHS in any way.” While there is merit to the Department’s argument about the contents of the Order of Remand, which a disinterested reading of the Order confirms, our decision does not turn on whether the Board actually directed a particular outcome; rather, of import is that the Hearing Officer’s determinations within the Second Recommended Order appear in all probability to be the result of a directive he perceived within the Board’s Order of Remand—an inappropriate basis for decision. We must be mindful that “[n]o person shall . . . be deprived of life liberty, or property, without due process of law[.]” U.S. Const. amend. V. 9 This applies doubly to the State. U.S. Const. amend. XIV, § 1; Mont. Const. art. II, § 17. The protections of due process include the “opportunity to be heard ‘at a meaningful time and in a meaningful manner.’” Connell v. Dep’t of Soc. & Rehab. Servs., Child Support Enf’t Div., 280 Mont. 491 , 496, 930 P.2d 88 , 91 (1997) (citing Montana Power Co. v. Public Service Comm., 206 Mont. 359 , 368, 671 P.2d 604 , 609 (1983)). Implicit in this is the guarantee that the hearing proceed in a manner consistent with essential fairness, which at a minimum requires that “an administrative hearing [] constitute a fair trial, conducted in accordance with fundamental principles of fair play and applicable procedural standards established by law.” Connell, 280 Mont. at 496, 930 P.2d at 91 (citation and internal quotation omitted). See also Rippo v. Baker, 137 S. Ct. 905 , 907 (2017) (holding the appearance of bias and impropriety is sufficient to violate due process rights). We conclude that the apparent infringement upon Appellee’s due process rights because of this unfortunate procedural misunderstanding must be addressed by another remand to a hearing officer. ¶16 We have determined to decide this case pursuant to Section I, Paragraph 3(c) of our Internal Operating Rules, which provides for memorandum opinions. In the opinion of the Court, the case presents a question controlled by settled law or by the clear application of applicable standards of review. ¶17 The District Court’s remand order is affirmed. /S/ JIM RICE 10 We concur: /S/ INGRID GUSTAFSON /S/ BETH BAKER /S/ LAURIE McKINNON /S/ JAMES JEREMIAH SHEA 11

2021-01-26 20:17:46.511872+00

http://www.courts.wa.gov/opinions/pdf/D2 53955-1-II Published Opinion.pdf

Filed Washington State Court of Appeals Division Two January 26, 2021 IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON DIVISION II STATE OF WASHINGTON, No. 53955-1-II Respondent, v. PUBLISHED OPINION TERRY EUGENE GAINES, Appellant. MAXA, J. – Terry Gaines challenges the superior court’s denial of his motion to remove his legal financial obligation (LFO) account from AllianceOne Receivables Management, Inc. (AllianceOne), a private debt collection agency, and return the account to the superior court clerk’s office. The superior court imposed LFOs, including restitution of $1.8 million, after Gaines’s conviction of multiple counts of trafficking in stolen property and money laundering related to the theft and resale of printer ink cartridges. When Gaines failed to make payment arrangements after being released from confinement, the court clerk referred Gaines’s LFO account to AllianceOne, and a collection fee of $738,312.68 was added to Gaines’s LFOs as authorized under RCW 19.16.500(1)(b). In denying Gaines’s motion, the superior court stated that it did not have the authority to direct the court clerk to remove his LFO account from AllianceOne. We disagree, and hold that the superior court erred in failing to recognize that it retained the authority under RCW 36.18.190 to remove Gaines’s LFO accounts from AllianceOne despite the court clerk’s No. 53955-1-II authority under the same statute to contract with AllianceOne. Accordingly, we reverse and remand for the superior court to exercise its discretion in considering whether to remove Gaines’s LFO account from the collection agency.1 FACTS Background In March 2012, Gaines was convicted in Pierce County of 34 counts of first degree trafficking in stolen property and eight counts of money laundering. At sentencing, the superior court imposed $1.8 million in restitution and $2,300 in other LFOs. The court also sentenced Gaines to 108 months of confinement. Regarding LFOs, the judgment and sentence stated that all payments must be made in accordance with the court clerk’s policies. In addition, the judgment and sentence stated, “The defendant shall pay the costs of services to collect unpaid legal financial obligations per contract or statute. RCW 36.18.190, 9.94A.780 and 19.16.500.” Clerk’s Papers (CP) at 30. Later, $8,685.02 in appellate costs were added to Gaines’s LFOs. In January 2018, Gaines was released from confinement. Interest at the rate of 12 percent per year had accrued while he was in custody, increasing his total LFO debt to over $3.1 million. In April, the court clerk’s office sent Gaines a letter entitled “Notice.” CP at 69. The notice noted that Gaines had been making monthly payments, apparently while he was incarcerated. But the notice stated that it was now necessary for Gaines to make new payment arrangements with the clerk’s office. The notice continued: 1 Gaines also argues that referring his LFO account to a collection agency and adding over $700,000 to his LFOs violated substantive and procedural due process and constituted an excessive fine in violation of the Eighth Amendment of the United States Constitution. Because of our holding, we do not address these constitutional issues. However, we do not disagree with the concurring opinion. 2 No. 53955-1-II Within 30 days from the date of this notice you must pay the outstanding balance due or make new arrangements for payment with this office. If you do not respond to this notice within the 30 days we will turn this case over to our Commercial Collection Agent. As of that time you will be required to deal ONLY with the collection agent regarding payments. CP at 69. Gaines did not contact or make new payment arrangements with the court clerk’s office. After more than 30 days passed, the clerk’s office referred Gaines’s judgment to AllianceOne, a private debt collection agency. AllianceOne subsequently sent Gaines a notice stating that his LFO account had been placed with AllianceOne for immediate collection efforts. The notice stated that the amount owing now included a fee in the amount of $738,312.68. This collection fee constituted 19 percent of the total judgment. In July, Gaines visited the court clerk’s office. The next month, he began to pay $10 per month toward his outstanding LFOs. Relationship Between Pierce County and AllianceOne Pierce County and AllianceOne executed a “Letter of Establishment” effective September 2012. CP at 122. The letter, signed by the Pierce County superior court clerk, stated that Pierce County wished to utilize AllianceOne to provide collection services for the recovery of unpaid LFOs, and that AllianceOne’s fee would be 19 percent of each payment received for in-state collections. The record contains a “Collection Services Agreement” between the Pierce County Superior Court and AllianceOne that provided for a 19 percent collection fee. CP at 75-79. The agreement stated that AllianceOne would be consulted before an assigned account was recalled and an appendix stated that “a particular account may be withdrawn at any time for any reason.” CP at 89. The agreement contained a signature line for the Pierce County clerk on behalf of the 3 No. 53955-1-II Pierce County Superior Court, but it was unsigned. Neither party disputes that this agreement was executed. Motion to Remove LFO Account from AllianceOne and Remit Certain LFOs In May 2019, Gaines filed a motion in superior court to remove his LFO account from AllianceOne and return the account to the superior court clerk’s office, to remit the collection fee assessed by AllianceOne, to waive any nonrestitution interest accrued on the LFO account, and to waive appellate costs. AllianceOne filed a memorandum in opposition to the motion. The superior court essentially denied the request, stating, “I don’t believe I have the authority to tell the Clerk what to do.” Report of Proceedings at 12. The court stated that it would waive nonrestitution interest and appellate costs, but stated that there had not been an adequate showing of hardship for the remittance of other LFOs. Gaines appeals the superior court’s denial of his motion to remove his LFO account from AllianceOne. ANALYSIS Gaines argues that the superior court had authority to remove his LFO account from AllianceOne under RCW 36.18.190, and that the trial court erred in failing to recognize that authority. We agree. A. STANDARD OF REVIEW There is no published case that addresses the applicable standard of review for Gaines’s motion to remove an LFO account from a collection agency. The State argues that we should review the superior court’s decision for an abuse of discretion. We generally review discretionary superior court decisions for abuse of discretion. See In re Pers. Restraint of Rhome, 172 Wn.2d 654 , 667-68, 260 P.3d 874 (2011). However, Gaines based his motion on 4 No. 53955-1-II RCW 36.18.190 and the superior court stated that it did not believe it had authority to consider Gaines’s motion. Therefore, we must engage in an interpretation of that statute. We review questions of statutory interpretation de novo. State v. Brown, 194 Wn.2d 972 , 975, 454 P.3d 870 (2019). In addition, the superior court’s failure to recognize that it has discretion to grant a motion is itself an abuse of discretion. See State v. McFarland, 189 Wn.2d 47 , 56, 399 P.3d 1106 (2017). And an erroneous interpretation of the law necessarily constitutes an abuse of discretion. State v. B.O.J., 194 Wn.2d 314 , 322-23, 449 P.3d 1006 (2019). B. INTERPRETATION OF RCW 36.18.190 The question here is whether the superior court has authority under RCW 36.18.190 to recall an LFO account from a collection agency after the court clerk has referred the account to the collection agency and a collection fee has been added to the defendant’s LFOs. We hold that the superior court does have that authority. 1. Statutory Provisions RCW 9.94A.760(5) and RCW 9.94A.760(9) generally authorize court clerks to collect unpaid LFOs. RCW 36.18.190 specifically addresses the use of collection agencies to recover LFOs: Superior court clerks may contract with collection agencies under chapter 19.16 RCW . . . for the collection of unpaid court-ordered legal financial obligations as enumerated in RCW 9.94A.030 that are ordered pursuant to a felony or misdemeanor conviction. . . . The costs for the agencies or county services shall be paid by the debtor. The superior court may, at sentencing or at any time within ten years, assess as court costs the moneys paid for remuneration for services or charges paid to collection agencies or for collection services. .... The servicing of an unpaid court obligation does not constitute assignment of a debt, and no contract with a collection agency may remove the court’s control over unpaid obligations owed to the court. 5 No. 53955-1-II (Emphasis added.) The first sentence of the statute references chapter 19.16 RCW. RCW 19.16.500(1)(a) states that a public agency may retain collection agencies to collect public debts, including restitution being collected on behalf of a crime victim. In addition, RCW 19.16.500(1)(b) addresses the collection agency fee: Any governmental entity as described in (a) of this subsection using a collection agency may add a reasonable fee, payable by the debtor, to the outstanding debt for the collection agency fee incurred or to be incurred. The amount to be paid for collection services shall be left to the agreement of the governmental entity and its collection agency or agencies, but a contingent fee of up to fifty percent of the first one hundred thousand dollars of the unpaid debt per account and up to thirty-five percent of the unpaid debt over one hundred thousand dollars per account is reasonable. (Emphasis added.) However, the last sentence of RCW 36.18.190 expressly provides that regardless of any collection agency contract, the superior court retains “control over unpaid obligations owed to the court.” 2. Statutory Interpretation The primary goal of statutory interpretation is to determine and give effect to the legislature’s intent. Brown, 194 Wn.2d at 975. To determine legislative intent, we first look to the plain language of the statute. Id. at 975-76. We consider the language of the provision in question, the context of the statute in which the provision is found, related provisions, and the statutory scheme as a whole. State v. Larson, 184 Wn.2d 843 , 848, 365 P.3d 740 (2015). If the plain meaning of a statute is unambiguous, we must apply that plain meaning as an expression of legislative intent. Id. 6 No. 53955-1-II 3. Analysis RCW 36.18.190 expressly authorizes superior court clerks to refer LFO accounts to collection agencies. And as Gaines acknowledges, this statute does not expressly authorize a court to remove an LFO account from a collection agency once a court clerk has referred the account to the agency. However, RCW 36.18.190 also expressly authorizes superior courts to retain control over unpaid LFOs. The plain statutory language shows that this provision takes precedence over the court clerks’ authority. RCW 36.18.190 states that “no contract with a collection agency may remove” that control. The State asserts that the reference in RCW 36.18.190 to the superior court’s “control over unpaid obligations owed to the court” recognizes only that the superior court retains authority to modify or rescind the amount of LFOs. But the crucial fact here is that the collection agency fee does affect the amount of LFOs. As noted above, RCW 19.16.500(1)(b) allows the court clerk to add the collection fee “to the outstanding debt”; here, Gaines’s LFOs. And RCW 36.18.190 itself allows the superior court to “assess as court costs the moneys paid for remuneration for services or charges paid to collection agencies or for collection services.” (Emphasis added.) Because the superior court retains control over the amount of LFOs under RCW 36.18.190, the court necessarily has the authority to reduce the amount of the LFOs by removing an LFO account from a collection agency and thereby removing the collection agency fee from the LFO account. This interpretation of RCW 38.18.190 is consistent with the Collection Services Agreement between the Pierce County Superior Court and AllianceOne. The agreement 7 No. 53955-1-II contemplates that an account assigned to AllianceOne may be recalled. And an appendix to the agreement states that “a particular account may be withdrawn at any time for any reason.” CP at 89. We conclude that the language in RCW 36.18.190 that the superior court retains “control over unpaid obligations owed to the court” authorizes the superior court to remove an LFO account from a collection agency even after a superior court clerk has referred the account to the agency. Whether a superior court actually will choose to remove the LFO from a collection agency will involve the exercise of the court’s discretion. The superior court denied Gaines’s motion to remove his LFO account from AllianceOne because the court did not believe that it had the authority to grant the motion. We hold that the superior court erred in failing to recognize that it did have that authority under RCW 36.18.190. CONCLUSION We reverse and remand for the superior court to exercise its discretion in considering whether to remove Gaines’s LFO account from the collection agency. MAXA, J. I concur: GLASGOW, J. 8 No. 53955-1-II WORSWICK, J. (concurring) — I concur in and completely agree with the lead opinion. I write separately to express concern over the practices and effects of court cost collection practices. When initially assessing legal financial obligations (LFOs), trial courts have an obligation to carefully consider each defendant’s ability to pay before imposing discretionary LFOs. State v. Blazina, 182 Wn.2d 827 , 838, 344 P.3d 680 (2015). In making this individualized inquiry, the court must consider factors such as incarceration and other debts, and are guided by GR 34.2 “[I]f someone does meet the GR 34 standard for indigency, courts should seriously question that person’s ability to pay LFOs.” Blazina, 182 Wn.2d at 839 . The court in Blazina, noted that organizations have chronicled problems indigent defendants incur when saddled with LFOs. 182 Wn.2d at 835 . The court discussed how interest accrual and collection costs create an untenable situation when defendants are able to pay only modest amounts against their fines, and who see their balances only increase with time. 182 Wn.2d at 836 . The court recognized that these unpaid fines tether individuals to the courts indefinitely, preventing their full reentry into society. 182 Wn.2d at 835-36 . These financial burdens impose an unequal burden on people of color and the poor. Bryan L. Adamson, Debt Bondage: How Private Collection Agencies Keep the Formerly Incarcerated Tethered to the Criminal Justice System, 15 Nw. J.L. & Soc. Pol’y 305, 318 (2020). In 2018, the legislature recognized these LFO burdens, and passed Engrossed Second Substitute House Bill 1783, 65th Leg., Reg. Sess. (Wash. 2018), which amended two statutes that prohibit the imposition of certain LFOs on indigent defendants. LAWS OF 2018, ch. 269. 2 GR 34 describes the ways a person may prove he or she is indigent for the purpose of seeking a waiver of filing fees and surcharges. 9 No. 53955-1-II Apparently, concern about debt bondage and disproportionate effects of LFOs ends when the judgment and sentence is signed. With minimal notice, a clerk’s office can send an LFO account to a private collection agency. RCW 19.16.500(1)(b) allows collection agencies to immediately impose a contingent fee of up to 50 percent of the total debt (which often includes compounded interest), deeming this amount to be “reasonable.” Here, the State argues that Terry Gaines was supposed to recognize that he would be subject to more than $700,000 in additional court costs because his judgment and sentence, entered in 2012, provided he could be charged for the costs of collecting unpaid fees and cited to the relevant statutes. And he was supposed to understand, when the clerk sent him a letter nearly six years later in 2018, that a collection fee of over $700,000 would be instantly added to his court costs if he did not make new payment arrangements with the court clerk, even though the letter neither mentioned any additional fees or costs, nor referred to the statutes allowing such fees. The letter stated that Gaines was in compliance with the LFO obligations imposed in his judgment and sentence, and it contained no express warning mentioning any additional costs or fees or any indication of how exorbitant the fee could be. In addition to the contingent fee, Gaines tells us that AllianceOne Receivables Management Inc. imposes even more fees for servicing the account and setting up payment plans. These fees are mechanically added, without any individualized consideration given to the defendant’s financial or indigent status. Ironically, it is the defendants’ inability to pay that lands them in this situation. Gaines asks this court to hold that these practices violate his due process rights and violate the Eighth Amendment. We do not reach that question today. But all the thought, concern, and consideration given to formulating rules to protect indigent defendants from 10 No. 53955-1-II crushing LFO debt should extend beyond the sentencing date. Any protections are illusory so long as courts allow private collection agencies to add exorbitant fees to LFOs. ____________________________ Worswick, P.J. I concur: ______________________________ Glasgow, J. 11

2021-01-26 20:17:48.504931+00

http://www.courts.wa.gov/opinions/pdf/D2 53365-1-II Unpublished Opinion.pdf

Filed Washington State Court of Appeals Division Two January 26, 2021 IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON DIVISION II STATE OF WASHINGTON, No. 53365-1-II Respondent, v. UNPUBLISHED OPINION TROY C. RESTVEDT, Appellant. MAXA, J. – Troy Restvedt appeals his convictions of resisting arrest and violating a Lewis County burn ban resolution (Resolution 248), which prohibited all fires in unincorporated Lewis County. The city of Centralia also had implemented a burn ban. The convictions arose from an incident in which police officers entered the private backyard of Restvedt’s residence in Centralia without a warrant because they observed a fire in violation of the burn ban. The trial court denied Restvedt’s motion to suppress evidence related to the entry based on the emergency aid function of the community caretaking exception to the warrant requirement. We hold that (1) the trial court erred in denying Restvedt’s motion to suppress because the State’s warrantless entry into his backyard was a pretext for a criminal investigation; (2) the State did not present sufficient evidence to convict Restvedt of resisting arrest because his arrest was unlawful; and (3) as the State concedes, the State did not present sufficient evidence to No. 53365-1-II convict Restvedt of violating Resolution 248 because his residence was not in unincorporated in Lewis County. Accordingly, we reverse the trial court’s order denying Restvedt’s suppression motion and remand for the trial court to dismiss Restvedt’s convictions for resisting arrest and violating Lewis County Resolution 248. FACTS Arrest of Restvedt In August 2018, the Lewis County Board of County Commissioners and Lewis County Fire Marshal passed Resolution 248, which expanded preexisting burn restrictions for all of unincorporated Lewis County. The City of Centralia also instituted a total burn ban. On August 17, 2018, the local fire department was called to Restvedt’s residence in Centralia because of a report of an illegal burn. The person the fire department contacted responded aggressively and acted like he did not know that a burn ban was in effect. Later, Centralia police officers Andrew Huerta and John Dorff responded to another report of an illegal burn at Restvedt’s residence. When they arrived, the officers smelled wood- burning smoke and saw smoke coming from the backyard area of the property. After walking to the backyard area, they saw a fire when looking in between two tarps that blocked the view of the area. The officers entered the area and encountered a man later identified as Restvedt and another man sitting by a small fire. Huerta advised Restvedt that there was a burn ban in effect and asked him to extinguish the fire. Restvedt became agitated and began to argue with Huerta about the fire. Restvedt eventually dumped two buckets of water on the fire while continuing to argue. 2 No. 53365-1-II Huerta then asked Restvedt for his name. Restvedt responded by cursing at Huerta and ordering the officers off his property. Both officers informed Restvedt that he was under arrest because of the fire. Huerta attempted to handcuff Restvedt, but Restvedt backed away and swatted at Huerta’s hands. Restvedt fell, and Huerta finally was able to handcuff him. The State charged Restvedt with third degree assault, resisting arrest, and violating Lewis County Resolution 248. Motion to Suppress and Dismiss Charges Before trial, Restvedt filed a motion to suppress under CrR 3.6 and to dismiss the charges against him. He argued that the officers’ warrantless entry into his backyard, which he claimed was a constitutionally protected area, was unlawful. He also argued that no exception to the warrant applied. Finally, he argued that because his arrest was illegal, he could not be convicted of resisting arrest. The State responded that the officers lawfully entered Restvedt’s backyard pursuant to the emergency/community caretaking exception to the warrant requirement. The State did not make any other argument as to why the entry into Restvedt’s backyard was lawful. The trial court conducted a CrR 3.6 hearing. The State presented testimony from Huerta and Dorff. Huerta confirmed that there was a total burn ban in effect on the day of the incident. He stated that he was dispatched to Restvedt’s property because the fire department had reported a possible burn there. According to dispatch, the fire department previously had asked Restvedt to put out the fire, and he had responded in an aggressive manner. Huerta testified that when he and Dorff arrived at Restvedt’s property they could smell and see smoke, and Dorff saw a fire in the backyard area. Huerta stated at that point he could not leave because of the burn ban. The officers then entered the area and contacted Restvedt and another man. Huerta testified that he went onto Restvedt’s property because “I wanted 3 No. 53365-1-II [Restvedt] to put the fire out due to the high risk of fire, due to the high risk of fire season, I wanted to prevent a fire in the area.” Report of Proceedings (RP) at 11. He was concerned that the fire might spread to Seminary Hill, a forested area that was only 15 to 20 feet from Restvedt’s property. He believed that the fire on Restvedt’s property was a violation of the burn ban. Huerta stated that when he first approached the property, he did not intend to place Restvedt under arrest. Instead, he merely wanted to “have [Restvedt] comply with the fire department like they asked previously.” RP at 13. However, he admitted that he told Restvedt that he could either put the fire out or be arrested. Huerta eventually asked Restvedt for his name, because “when I was going to criminally cite him for the -- if I was to criminally cite him for the reckless burning, then I know who I would have had contact with.” RP at 12. Restvedt responded by stating “F*** you and get the f*** off my property.” RP at 13. Huerta believed that Restvedt was not going to comply with the investigation. He then decided to place Restvedt in custody for the illegal burn. On cross-examination, Huerta acknowledged that the officers arrived without lights and sirens and that they were not prepared to battle a fire. They did not request backup from the fire department. They did not bring fire extinguishers when they approached the property. Huerta admitted that there was no reason for him to believe that there was an emergency going on. When he arrived to the call, he responded to dispatch with a code indicating that there was no emergency and that things were under control. Dorff testified that he was dispatched to Restvedt’s property because of a report of an illegal fire. When he arrived he smelled smoke, and at that point he could not leave “[b]ecause there was a burn ban in effect and my job is to enforce the laws or educate people on the laws.” 4 No. 53365-1-II RP at 37. Dorff “believed there was an illegal fire going on” because of the burn ban. RP at 44. Dorff then saw the fire through a gap in tarps that were shielding the backyard area. Dorff and Huerta entered the backyard area and located the fire. After entering the backyard, Dorff observed dry wood and debris and a compost pile containing dry leaves near the fire. The fire also was close to the Seminary Hill nature preserve, and Dorff was concerned about the nearby fir trees catching fire because it was so dry. On cross-examination, Dorff stated that he could enter Restvedt’s property because “I have the authority to enforce laws and when there’s a law being broken I go and investigate it.” RP at 46. He also testified that he “had probable cause to believe that they were in violation of the burn ban.” RP at 46. The trial court denied Restvedt’s motion to suppress and dismiss. The court stated its reasoning in an oral ruling that the officers’ entry onto Restvedt’s property was justified under the community caretaking exception to the warrant requirement. The court entered written findings of fact consistent with the facts stated above, and entered the following conclusions of law: 2.1 The officers had a legitimate emergency concern in ensuring the defendant’s fire was out during a county-wide burn ban. 2.2 The facts surrounding the fire department’s report to dispatch and the smell of smoke the officers noticed when they got out of their vehicle was enough to justify the warrantless entry to the back part of the defendant’s yard where the fire pit was located. CP at 103. Conviction The facts outlined above were presented at trial. The jury convicted Restvedt of resisting arrest and violating Lewis County Resolution 248. The jury acquitted him of third degree assault. 5 No. 53365-1-II Restvedt appeals the trial court’s order denying his suppression motion and his convictions. ANALYSIS A. EMERGENCY AID FUNCTION OF COMMUNITY CARETAKING EXCEPTION Restvedt argues that the trial court erred in denying his CrR 3.6 motion to suppress based on a ruling that the emergency aid function of the community caretaking exception to the warrant requirement was applicable to Huerta’s and Dorff’s warrantless entry into the backyard area of his residence. We agree. 1. Standard of Review We review the denial of a motion to suppress to determine whether substantial evidence supports the trial court’s findings of fact and whether the findings of fact support the trial court’s conclusions of law. State v. Boisselle, 194 Wn.2d 1 , 14, 448 P.3d 19 (2019). Here, Restvedt did not assign error to any of the trial court’s findings of fact. Therefore, those findings are verities on appeal. State v. Escalante, 195 Wn.2d 526 , 531, 461 P.3d 1183 (2020). We review de novo the trial court’s conclusions of law. Boisselle, 194 Wn.2d at 14. 2. Community Caretaking Exception Article I, section 7 of the Washington Constitution states, “No person shall be disturbed in his private affairs, or his home invaded, without authority of law.” The Fourth Amendment to the United States Constitution protects “the right of the people to be secure in their . . . houses.” Under these provisions, a person’s home receives special constitutional protection. State v. Schultz, 170 Wn.2d 746 , 753, 248 P.3d 484 (2011). This protection generally extends to the curtilage of a home that is not impliedly open to the public, because the curtilage is intimately tied to the home. State v. Ross, 141 Wn.2d 304 , 312, 4 P.3d 130 (2000). This protection may 6 No. 53365-1-II include a yard area not open to the public. See State v. Hoke, 72 Wn. App. 869 , 873-75, 866 P.2d 670 (1994). As a result a warrant generally is required for law enforcement to enter a person’s residence or curtilage not open to the public. State v. Hinshaw, 149 Wn. App. 747 , 750, 205 P.3d 178 (2009) (residence); Ross, 141 Wn.2d at 312 (curtilage). One exception to the warrant requirement is the community caretaking exception. Boisselle, 194 Wn.2d at 10. “This exception recognizes that law enforcement officers are ‘jacks of all trades’ and frequently engage in community caretaking functions that are unrelated to the detection and investigation of crime.” Id. Officers may “make a limited invasion of constitutionally protected privacy rights” when necessary to perform those community caretaking functions. Id. The exception encompasses two functions: routine checks on health and safety and rendering emergency aid. Id. at 11. The threshold question for application of the community caretaking exception is whether the officers’ conduct was a pretext for a criminal investigation. Id. at 11, 14-15. For the exception to apply, the officer’s actions must be “ ‘totally divorced’ from the detection and investigation of criminal activity.” Id. at 11 (quoting State v. Kinzy, 141 Wn. 2d 373 , 385, 5 P.3d 668 (2000)). “When officers act to uncover criminal activity, their actions are of the very type that article I, section 7’s warrant requirement is directed.” Boisselle, 194 Wn.2d at 16. The second step in the analysis depends on which function the officer was utilizing. Id. Here, the trial court relied on the emergency aid function. The court in Boisselle adopted an amended test to determine when the emergency aid function of the community caretaking exception applies: (1) the officer subjectively believed that an emergency existed requiring that he or she provide immediate assistance to protect or preserve life or property, or to prevent serious injury, (2) a reasonable person in the same situation would similarly believe that there 7 No. 53365-1-II was a need for assistance, and (3) there was a reasonable basis to associate the need for assistance with the place searched. Id. at 14. This amended test “make[s] clear that there must be a present emergency for the emergency aid function test to apply.” Id. Finally, if the officer’s activity satisfies the emergency aid function test, the court determines whether the activity was reasonable. Id. at 11-12. The court must also weigh the public’s interest in having law enforcement perform a community caretaking function against the citizen’s privacy interest. Id. at 12. 3. Pretext Analysis Restvedt argues that Huerta’s and Dorff’s warrantless entry into his backyard was a pretext for a criminal investigation. The State contends that the entry was motivated by an ongoing emergency. We agree with Restvedt. Whether an officer’s alleged community caretaking activity is a pretext for a criminal investigation depends on the totality of the circumstances. Boisselle, 194 Wn.2d at 15. The court should consider “ ‘both the subjective intent of the officer as well as the objective reasonableness of the officer’s behavior.’ ” Id. (quoting State v. Ladson, 138 Wn.2d 343 , 359, 979 P.2d 833 (1999). In Boisselle, two officers went to the defendant’s residence because of anonymous calls reporting a crime. 194 Wn.2d at 15. They noticed a smell that could be from a decomposing body, and they wanted to determine whether a crime had been committed or if a crime victim was inside. Id. They also were informed that the residence might be associated with a homicide investigation. Id. The officers had suspicions that a crime had taken place, and they decided to enter and make a warrantless entry and search of the residence – nearly two hours after they had arrived. Id. 8 No. 53365-1-II The Supreme Court held that law enforcement’s warrantless entry into and search of the defendant’s residence was pretextual. Id. at 16-17. The court stated: Taken together, these facts demonstrate that the officers were suspicious, if not convinced, that a crime had taken place. Because of the officers’ significant suspicions, the search of [the defendant’s] home was necessarily associated with the detection and investigation of criminal activity. . . . While the officers purportedly entered [the defendant’s] home to render aid or assistance, the officers were not solely motivated by a perceived need to provide immediate aid. Indeed, the trial court found that the officers “were not able to confirm an immediate emergency existed.” Instead, the officers sought to perform their official duties to uncover whether a crime had taken place and whether a crime victim was located inside [the defendant’s] home. Id. at 16 (emphasis added) (citations omitted). The court concluded, Because [1] the officers had significant suspicions of criminal activity, [2] the officers were conducting a criminal investigation, and [3] there was no present emergency, it was objectively unreasonable for the officers to conduct a warrantless search of [the defendant’s] home. Consequently, it appears that the officers used the emergency aid community caretaking function as a mere pretense for an evidentiary search. Id. Here, the evidence showed that Huerta and Dorff had a legitimate concern that the fire might spread to the trees in the nearby Seminary Hill nature area. The trial court made findings that there were dried leaves and flammable construction material near the fire and that the trees on Seminary Hill were only 15-20 feet away from the fire. These findings arguably support the trial court’s conclusion that “[t]he officers had a legitimate emergency concern in ensuring the defendant’s fire was out during a county-wide burn ban.” CP at 103. However, the officers’ observations were made only after they had entered Restvedt’s property. Therefore, these findings and the conclusion do not address whether that entry was lawful. 9 No. 53365-1-II The trial court’s ultimate conclusion that the officer’s entry onto Restvedt’s property was justified depends on the threshold question of whether the entry was a pretext for a criminal investigation. Boisselle, 194 Wn.2d at 11. The trial court did not specifically address this question. The court in Boisselle stated that to avoid a finding of pretext, the officers’ actions must be (1) “ ‘totally divorced,’ from the detection and investigation of criminal activity,” Id. at 11 (emphasis added) (quoting Kinzy, 141 Wn.2d at 385); and (2) “solely motivated by a perceived need to provide immediate aid.” Id. at 16 (emphasis added). These requirements are not satisfied here. The facts in this case are similar to those in Boisselle. First, as in Boisselle, the record reflects that Huerta and Dorff “had significant suspicions of criminal activity.” Id. at 16. Law enforcement involvement began because of a 911 call from the fire department reporting an illegal fire at Restvedt’s residence. Both officers were aware of the burn ban, smelled wood- burning smoke upon arriving at Restvedt’s home, and saw a fire the backyard area. Huerta stated at that point he could not leave because of the burn ban. Dorff stated that he could not leave “[b]ecause there was a burn ban in effect and my job is to enforce the laws or educate people on the laws.” RP at 37. Before he entered the property, Dorff “believed there was an illegal fire going on” because of the burn ban. RP at 44. Dorff testified that he had authority to enter Restvedt’s property because he had probable cause to believe that Restvedt was violating the burn ban. Second, as in Boisselle, the officers “were conducting a criminal investigation.” 194 Wn.2d at 16. Dorff stated that he could enter Restvedt’s property because he had authority to 10 No. 53365-1-II enforce the law and “when there’s a law being broken I go and investigate it.” RP at 46. The officers entered Restvedt’s backyard to investigate whether he was in fact violating the burn ban. Third, as in Boisselle, the record shows that there was “no present emergency” at Restvedt’s residence that required immediate assistance. 194 Wn.2d at 16. Huerta testified that there was no emergency going on when he responded to the call. The officers arrived at the scene without lights or sirens, did not request backup from the fire department, and approached the property without fire extinguishers. And when Huerta arrived, he reported to dispatch that there was no emergency and that things were under control. The dissent claims that the officers were addressing an emergency situation, but the evidence simply does not support that claim. The State argues that Dorff’s testimony regarding his authority to enforce the law and his belief that when a law is broken he investigates it should not negate Huerta’s testimony that his main concern was safety and that he simply wanted Restvedt to put out the fire. However, both officers were dispatched to Restvedt’s residence to investigate an unlawful fire. In addition, both officers entered Restvedt’s property together, and there is no question based on Dorff’s testimony and even based on Huerta’s testimony that providing emergency aid was not the sole motivation for their entry.1 Because the officer’s actions were not totally divorced from the detection and investigation of criminal activity, we conclude that the warrantless entry into Restvedt’s backyard was a pretext for a criminal investigation and therefore did not fall within the 1 The dissent claims that we are imputing Huerta’s motivation to both officers. Not so. Although Dorf testified that he was concerned about the fire spreading, the record is clear that this concern was not his only motivation for entering Restvedt’s property and he believed that there was no emergency. In any event, we disagree that a warrantless entry onto property by two officers is justified when one officer enters with the purpose of community caretaking while the other clearly is entering to investigate a crime. 11 No. 53365-1-II emergency function of the community caretaking exception to the warrant. The officers’ entry was not solely motivated by a perceived need to provide immediate emergency aid. Accordingly, we hold that the trial court erred in ruling that the emergency aid function of the community caretaking exception applied to the officers’ warrantless search. 4. State’s Proposed Burn Ban Exception to Boisselle The State argues that we should create a blanket exception for burn ban investigations to the rule in Boisselle that for the community caretaking exception to apply, a warrantless entry must be totally divorced from a criminal investigation. The State claims that under the rule as expressed in Boisselle, law enforcement could never enter private property without a warrant to address an emergency fire when a burn ban is in place. The State urges this court to rule that Boisselle is incorrect and harmful in this context. However, once the Supreme Court has decided an issue of state law, that interpretation is binding on all lower courts until it is overturned by the Supreme Court. State v. Jones, 182 Wn.2d 1 , 5, 338 P.3d 278 (2014). Therefore, we are precluded from creating an exception to the rule stated in Boisselle. 5. Alternative Courses of Action It is important to recognize that if the officers genuinely were interested only in the risk of the fire spreading, they had a readily available alternative: obtaining a warrant. One officer could have worked on requesting a warrant while the other officer kept a close eye – from a public street – on the fire. The officers also could have asked for permission to enter and talk to Restvedt about the danger of maintaining the fire, as the fire department previously had attempted, rather that entering without permission. 12 No. 53365-1-II Further, the community caretaking exception is not the only exception to the warrant requirement. If officers were addressing a fire that was out of control, the exigent circumstances exception to the warrant requirement could have applied. See State v. Rawley, 13 Wn. App. 2d 474, 479, 466 P.3d 784 (2020). But here there was no evidence of any exigent circumstances. 6. Summary We hold that the trial court erred in ruling that the officers’ entry onto Restvedt’s property was lawful under the emergency aid function of the community caretaking exception to the warrant requirement. Therefore, we reverse the trial court’s denial of Restvedt’s suppression motion. B. SUFFICIENCY OF THE EVIDENCE – RESISTING ARREST Restvedt argues that the State presented insufficient evidence to convict him of resisting arrest because the State failed to show that Restvedt was resisting a lawful arrest. He argues that his arrest was unlawful because the officers’ warrantless entry of his backyard was unlawful. We agree. When evaluating the sufficiency of evidence for a conviction, the test is whether, after viewing the evidence in the light most favorable to the State, any rational trier of fact could have found the elements of the crime beyond a reasonable doubt. State v. Homan, 181 Wn.2d 102 , 105, 330 P.3d 182 (2014). We will assume the truth of the State’s evidence and all reasonable inferences drawn from that evidence when evaluating whether sufficient evidence exists. Id. at 106 . A person is guilty of resisting arrest if he intentionally prevents or attempts to prevent a peace officer from lawfully arresting him. RCW 9A.76.040. The State’s only argument regarding sufficiency of evidence is that the officers’ entry onto Restvedt’s property was lawful, 13 No. 53365-1-II and therefore the arrest was lawful. But we have held above that the entry was not lawful. Therefore, the State’s argument fails. And the State does not argue that the arrest was lawful even if the entry was unlawful. See State v. Solberg, 122 Wn.2d 688 , 696-97, 861 P.2d 460 (1993) (stating that “in the absence of exigent circumstances, police may not make a warrantless arrest after a nonconsensual entry into a suspect’s home.”). Accordingly, we hold that the State failed to present sufficient evidence to show that Restvedt resisted a lawful arrest. C. SUFFICIENCY OF THE EVIDENCE – LEWIS COUNTY RESOLUTION 248 Restvedt argues, and the State concedes, that sufficient evidence does not support his conviction of violating Lewis County Resolution 248. We accept the State’s concession and reverse Restvedt’s conviction. In August of 2018, the Lewis County Board of County Commissioners and Lewis County Fire Marshal passed Resolution 248, which expanded the burn restrictions “for all of unincorporated Lewis County, Washington.” CP at 94 (emphasis added). The State charged Restvedt with violating Resolution 248. However, it is undisputed that Restvedt’s residence was in Centralia, an incorporated city in Lewis County. Therefore, Resolution 248 did not apply to Restvedt’s fire. Centralia also implemented a total burn ban, but the State did not charge Restvedt with violating Centralia’s burn ban. We conclude that sufficient evidence does not support Restvedt’s conviction of violating Lewis County Resolution 248. 14 No. 53365-1-II CONCLUSION We reverse the trial court’s order denying Restvedt’s suppression motion related to the warrantless entry into Restvedt’s backyard and remand for the trial court to dismiss Restvedt’s convictions for resisting arrest and violating Lewis County Resolution 248. A majority of the panel having determined that this opinion will not be printed in the Washington Appellate Reports, but will be filed for public record in accordance with RCW 2.06.040, it is so ordered. MAXA, J. I concur: WORSWICK, P.J. 15 No. 53365-1-II GLASGOW, J., concurring in part and dissenting in part—A drought combined with unusually high temperatures in summer 2018 created very dry conditions in western Washington. Fire danger was particularly high that summer. There was at least one wildfire on the Olympic Peninsula, an unusual event west of the Cascades. That wildfire became large enough to create smoky conditions in Seattle.2 Both Lewis County and the city of Centralia, like almost all local governments, had total burn bans in place. Troy C. Restvedt’s property backed up against Seminary Hill, an area dense with large trees. Ex. 1 (excerpt). 2 https://wasmoke.blogspot.com/2018/08/wa-keeps-accumulating-smoke-through.html?m=1. 16 No. 53365-1-II Ex. 4 (excerpt). Officers Andrew Huerta and John Dorff responded to a call about a fire on Restvedt’s property. The fire department had already told Restvedt earlier that same day that he needed to put out his backyard fire to comply with the burn ban. When there was a new report of a fire on Restvedt’s property, the fire department contacted police because their attempts to get Restvedt to stop burning had been unsuccessful and his response had been aggressive. When the officers arrived they could smell smoke coming from Restvedt’s backyard. Officer Huerta testified that “I was made aware by Officer Dorff that he [had] actually seen the fire coming from that area. I saw the smoke as well.” Verbatim Report of Proceedings (VRP) (Oct. 31, 2018) at 10. Officer Dorff testified that he smelled and saw smoke coming from the backyard. Officer Huerta also testified that there was not a fence or a gate between where he parked his vehicle and the place where he first contacted Restvedt. The officers walked down the gravel driveway on the south side of the house to the side of the backyard. Officer Dorff testified that as he approached the backyard from the south, he could see the fire through a gap in two hanging tarps. 17 No. 53365-1-II The officers were aware of the dry conditions, and Huerta was concerned that the fire could spread to the large nearby trees. Huerta said that his purpose for going onto Restvedt’s property was to get him to put out the fire because of the high fire risk. He “wanted to prevent a fire in the area.” Id. at 11. Officer Dorff testified that he could not ignore the backyard fire because “there was a burn ban in effect and my job is to enforce the laws or educate people on the laws.” Id. at 37. He was aware that the Seminary Hill was a “very thick forest [of] fir trees.” Id. at 38. He was concerned that if they caught fire, those trees would “burn as if they have gasoline on them.” Id. at 39. He also said that he had authority to investigate and enforce the law when he is aware that the law is being broken, but his “primary reason” for entering the backyard was concern about the risk of fire. Id. at 42.3 The trial court concluded that given what the officers knew when they arrived, that there was a burn ban because of severe fire danger, that Restvedt was ignoring a fire department demand that he not burn fires in his backyard, that the fire department had asked for police assistance, that there were large trees nearby, and that they smelled smoke as soon as they arrived, this warranted them walking on the gravel driveway toward the backyard. Once they were near the backyard, they saw the fire through hanging tarps. All of this warranted them entering the backyard because they had “a legitimate emergency concern in ensuring the defendant’s fire was out during a county- wide burn ban” under the community caretaking exception to the warrant requirement. Clerk’s Papers at 103. 3 Once they were inside the backyard, the officers testified that there was a compost pile full of dry leaves that caused them additional concern regarding fire danger. 18 No. 53365-1-II I disagree with the majority’s conclusion that the officers had to have a warrant to validly enter Restvedt’s backyard for two reasons. First, I disagree with the majority’s assessment of the nature of the risk involved. Under State v. Boisselle, 194 Wn.2d 1 , 14, 448 P.3d 19 (2020), the emergency aid function of the community caretaking exception to the warrant requirement applies where three requirements are met. The officer must have “subjectively believed that an emergency existed requiring that he or she provide immediate assistance to protect or preserve life or property, or to prevent serious injury,” a reasonable person would agree such an emergency existed, and there was a reasonable connection between the emergency and the place entered. Id. (emphasis added). Here, there was a significant fire danger in western Washington in summer 2018, there were large trees in close proximity, and a fire in those trees could quickly threaten the safety of nearby neighbors also living very near the Seminary Hill tree line. Restvedt had ignored a fire department demand made earlier that day that he not burn anything on his property, and officers could not realistically ensure the fire was truly extinguished without entering the property in light of Restvedt’s prior noncompliance. All of these facts supported a reasonable belief that there was an emergent threat to property and to nearby neighbors’ safety, especially considering how fast a fire can spread through large, dry trees like the ones depicted in exhibits 1 and 4, supra. I would affirm the trial court’s conclusion that this situation was emergent enough to warrant entry onto the property for the community caretaking function of ensuring that the fire was out. This was exactly what the officers did as soon as they entered the backyard—they immediately insisted that Restvedt put out the fire by dousing it with two buckets of water. Second, I disagree with the majority’s expansion of Boisselle’s pretext analysis to impute one officer’s thinking to all officers involved. Nothing in Boisselle requires us to do so, see 194 19 No. 53365-1-II Wn.2d. at 14-18, and I would not expand Boisselle beyond its express requirements. Here, Officer Huerta testified to a single motivation for entering the backyard, he “wanted to prevent a fire in the area.” VRP (Oct. 31, 2018) at 11. There is no testimony or other evidence indicating that Officer Huerta had any motive other than to ensure safety. Under Boisselle, he was not acting under a pretext of investigation and he legitimately entered Restvedt’s backyard. His legitimate presence should not be undermined by Officer Dorff’s belief that he could enforce the burn ban, which, incidentally, could easily have meant simply putting out the fire. Moreover, the facts of this case are significantly different from Boisselle, and I would limit Boisselle’s pretext analysis to cases presenting similar facts. In Boisselle, the officers waited nearly two hours after their arrival to enter the home at issue in that case. 194 Wn.2d at 5-6. The officers did not think there was any immediate peril. Id. Instead, the officers suspected that there was a dead body in the home. Id. Here, in contrast, the officers went to Restvedt’s property at the request of the fire department and they entered the backyard immediately after they arrived and realized there was a fire burning. These facts are a far cry from those presented in Boisselle. I respectfully dissent and would instead affirm the trial court’s denial of Restvedt’s suppression motion. I would affirm Restvedt’s conviction for resisting arrest. I agree with the State’s concession and the majority’s conclusion that sufficient evidence does not support Restvedt’s conviction of violating Lewis County Resolution No. 248. ____________________________________ Glasgow, J. 20

2021-01-26 20:17:48.744733+00

http://www.courts.wa.gov/opinions/pdf/D2 53492-4-II Unpublished Opinion.pdf

Filed Washington State Court of Appeals Division Two IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON January 26, 2021 DIVISION II STATE OF WASHINGTON, No. 53492-4-II Respondent, v. SEAN LEE LAIR, UNPUBLISHED OPINION Appellant. GLASGOW, J.—After a morning of drinking and golf, Sean Lee Lair was roughhousing with his coworker, Brendon Byman, in Lair’s backyard. When another coworker, Scott Mallow, saw the two roughhousing, he became concerned for Byman and put Lair into a choke hold. Lair released Byman, and Mallow released Lair. Lair then lunged at Mallow, stabbing him in the chest with a knife. The State charged Lair with second degree assault while armed with a deadly weapon. A jury rejected Lair’s self-defense theory and found Lair guilty. Lair appeals his conviction and argues that the trial court erred by issuing a first aggressor jury instruction. Lair also argues that his defense counsel rendered ineffective assistance by failing to object to the instruction. Because Lair failed to object to the first aggressor instruction below, and he does not show that the instruction constituted manifest constitutional error, we decline to review his first aggressor instruction claim. We also hold that Lair fails to show that his defense counsel’s failure to object to the instruction constituted deficient performance or prejudiced him and, therefore, his ineffective assistance claim fails. Accordingly, we affirm Lair’s conviction. No. 53492-4-II FACTS The State charged Lair with second degree assault with a deadly weapon enhancement based on a fight between Lair and his former coworker Mallow, which ended with Lair stabbing Mallow in the chest. At trial, Mallow testified that he, Lair, and two other coworkers—Byman and Todd Bartlett—planned to play golf together in November 2018. The foursome became significantly intoxicated, left the golf course after completing just four holes, and returned to Lair’s home. Bartlett left, and Lair, Mallow, and Byman remained at Lair’s home. Mallow said that he used Lair’s restroom and when he returned to the backyard, he saw Lair and Byman wrestling on the ground. Lair had Byman in a choke hold. Byman appeared to be having trouble breathing. Mallow asked Lair what he was doing, and Lair responded, “This is like my son.” Verbatim Report of Proceedings (VRP) (June 11, 2019) at 45. Mallow told Lair to let go of Byman, but Lair began squeezing Byman’s neck tighter. Mallow became concerned for Byman’s safety and tried, unsuccessfully, to pry the two apart. Mallow put Lair in a choke hold in an attempt to make Lair release Byman. Lair eventually let go of Byman. Mallow testified that when Lair released Byman, Mallow released Lair. When Mallow turned around to face Lair, Lair lunged toward Mallow with a knife and cut Mallow across his thumb. Mallow asked Lair, “[W]hat are you doing?” and stepped back. VRP (June 11, 2019) at 49. Lair then lunged forward a second time and stabbed Mallow in the chest. Mallow started screaming at Lair, and Lair backed away and went inside his house. Mallow left through the backyard fence and eventually went to a hospital for stitches. 2 No. 53492-4-II Byman testified at trial that he and Lair had been roughhousing in Lair’s backyard. Byman recalled that his arm dragged across the ground, but he was not concerned about blacking out from air restriction. Byman thought he and Lair were just playing around, as they had in the past. Even so, Byman’s arm was injured enough to bring tears to his eyes. Lair also testified at trial, and his version of events was different from Mallow’s. Lair said that after the group returned to his home after golfing, Lair and Byman started playing around and wrestling. At some point, Mallow joined them in the backyard and grabbed Lair by the neck. Lair explained that he had a hearing impairment that might have limited his ability to hear if Byman told him to stop. Mallow squeezed Lair’s neck and Lair testified that he lost consciousness. After Mallow released Lair, and Lair regained consciousness, Lair and Mallow argued. Lair twice asked Mallow to leave. Lair said that Mallow would not leave and when Mallow lunged to grab Lair by the throat a second time, Lair pulled a knife out of his pocket and stuck Mallow with the blade. The confrontation ended after Lair stabbed Mallow. Lair and the State agreed that self-defense instructions were appropriate given the evidence. The trial court instructed the jury that use of force is lawful “when used by a person who reasonably believes that he is about to be injured in preventing or attempting to prevent an offense against the person, and when the force is not more than is necessary.” Clerk’s Papers (CP) at 54. The State also proposed a first aggressor instruction. Lair did not object, and the trial court gave the following instruction to the jury. No person may, by any intentional act reasonably likely to provoke a belligerent response, create a necessity for acting in self-defense and thereupon use force upon or toward another person. Therefore, if you find beyond a reasonable doubt that the defendant was the aggressor, and that defendant’s acts 3 No. 53492-4-II and conduct provoked or commenced the fight, then self-defense is not available as a defense. CP at 59. The jury found Lair guilty of second degree assault with a deadly weapon enhancement. Lair appeals his conviction. ANALYSIS I. FIRST AGGRESSOR INSTRUCTION Lair argues that the trial court erred by giving a first aggressor jury instruction. Because Lair failed to object to the instruction at trial and does not show that it constituted manifest constitutional error, we decline to address the issue. Generally, a defendant cannot challenge a jury instruction on appeal if they did not object to the instruction in the trial court. State v. Grott, 195 Wn.2d 256 , 267, 458 P.3d 750 (2020); CrR 6.15(c). But under RAP 2.5(a)(3), an appellant may raise an error for the first time on appeal if the error is “manifest” and truly of constitutional dimension. Grott, 195 Wn.2d at 267. The appellant must identify an error of constitutional magnitude and make a “‘plausible showing . . . that the asserted error had practical and identifiable consequences in the trial of the case.’” Id. at 269 (internal quotation marks omitted) (quoting State v. O’Hara, 167 Wn.2d 91 , 99, 217 P.3d 756 (2009)). Jury instruction errors that have been held to be manifest constitutional errors involve errors “‘directing a verdict, shifting the burden of proof to the defendant, failing to define the beyond a reasonable doubt standard, failing to require a unanimous verdict, and omitting an element of the crime charged.’” Id. at 268 (internal quotation marks omitted) (quoting O'Hara, 167 Wn.2d at 100-01). “Because first aggressor instructions do not actually relieve the State of 4 No. 53492-4-II its burden of proof, erroneously given first aggressor instructions are not necessarily errors of constitutional magnitude.” Id. at 268-69. Here, Lair neither argues nor shows that the instructional error was a manifest error of constitutional magnitude. He fails to discuss RAP 2.5(a)(3) in his opening brief. Instead, Lair contends that he sufficiently preserved the alleged error by not proposing the instruction himself. But it is well established that the failure to contemporaneously object to proposed jury instructions waives the issue for appeal unless it is a manifest error affecting a constitutional right. See id. at 268; RAP 2.5(a)(3); CrR 6.15(c). Lair fails to argue or establish either that the alleged error was of a constitutional dimension or that it was manifest. Therefore, we do not address Lair's claim for the first time on appeal. II. INEFFECTIVE ASSISTANCE OF COUNSEL In the alternative, Lair argues that he received ineffective assistance of counsel when defense counsel failed to object to the first aggressor instruction. We disagree. The Sixth Amendment to the United States Constitution and article I, section 22 of the Washington Constitution guarantee effective assistance of counsel. State v. Grier, 171 Wn.2d 17 , 32, 246 P.3d 1260 (2011). To demonstrate that he received ineffective assistance of counsel, Lair must show both (1) that defense counsel’s performance was deficient and (2) that the deficient performance resulted in prejudice. State v. Linville, 191 Wn.2d 513 , 524, 423 P.3d 842 (2018). Defense counsel’s performance is deficient if it falls below an objective standard of reasonableness. State v. Estes, 188 Wn.2d 450 , 458, 395 P.3d 1045 (2017). Prejudice ensues if the result of the proceeding would have been different had defense counsel not performed deficiently. Id. 5 No. 53492-4-II Lair fails to show that counsel was deficient or that prejudice resulted from the failure to object to the first aggressor instruction because there is no reasonable probability that an objection would have been successful. State v. Gerdts, 136 Wn. App. 720 , 727, 150 P.3d 627 (2007). “Whether the State produced sufficient evidence to justify a first aggressor instruction is a question of law” that we review de novo. State v. Bea, 162 Wn. App. 570 , 577, 254 P.3d 948 (2011). “The State need only produce some evidence that [the defendant] was the aggressor to meet its burden of production” warranting the instruction. Id. Here, the first aggressor instruction was appropriate if Lair provoked Mallow by initiating the fight. Although some testimony indicated that Lair was just roughhousing with Byman, Byman also testified that his arm was injured enough to bring tears to his eyes. And Mallow testified that he unsuccessfully tried to get Lair to let go of Byman first verbally, and then by trying to pry them apart. Mallow also testified that once they were all on their feet, Lair lunged at him with the knife first. Even though Lair’s testimony differed from Mallow’s, there was some evidence that Lair was the aggressor who initiated the fight. Thus, defense counsel reasonably did not object to the first aggressor instruction where the instruction was supported by the evidence. Lair also fails to show prejudice. For the same reasons, even had defense counsel objected, there is no reasonable probability that the trial court would have sustained an objection to the first aggressor instruction because there was some evidence supporting the instruction. Lair, therefore, fails to show that he received ineffective assistance of counsel. We affirm. 6 No. 53492-4-II A majority of the panel having determined that this opinion will not be printed in the Washington Appellate Reports, but will be filed for public record in accordance with RCW 2.06.040, it is so ordered. Glasgow, J. We concur: Lee, C.J. Worswick, J. 7

2021-01-26 20:17:48.933032+00

http://www.courts.wa.gov/opinions/pdf/D2 54090-8-II Unpublished Opinion.pdf

Filed Washington State Court of Appeals Division Two January 26, 2021 IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON DIVISION II STATE OF WASHINGTON, No. 54090-8-II Respondent, v. J.E.B., UNPUBLISHED OPINION Appellant. GLASGOW, J.—JEB pleaded guilty in juvenile court to one count of a minor in possession of liquor, one count of assault in the fourth degree–domestic violence, and one count of assault in the fourth degree. The juvenile court sentenced him to one year of community supervision and imposed supervision conditions. One condition prohibited JEB from possessing dangerous weapons. JEB then violated this condition by possessing a knife. On appeal from the order requiring him to serve time in detention because of this violation, JEB argues that the condition was invalid because it was not crime related. We dismiss JEB’s appeal because his challenge to the condition was untimely. FACTS JEB came home intoxicated after skipping school, and he punched both of his parents. JEB pleaded guilty in juvenile court to one count of a minor in possession of liquor, one count of assault in the fourth degree–domestic violence, and one count of assault in the fourth degree. There is no evidence in the record that JEB used a weapon when committing these offenses. In November No. 54090-8-II 2018, the juvenile court sentenced JEB to time already served in confinement and 12 months of community supervision. JEB agreed to abide by certain supervision conditions. Among the conditions the juvenile court imposed, JEB was prohibited from possessing dangerous weapons. The order on adjudication and disposition also stated that the probation counselor could “specify in writing further details of this prohibition.” Clerk’s Papers (CP) at 16. JEB was required to comply with “all written home and probation rules.” Id. The written probation rules that JEB signed stated, “I will not possess any weapon at any time, including knives.” CP at 69. This condition was imposed because JEB exhibited problems with aggression and anger and he had previously made threats to harm people. While JEB was in detention on another probation violation, his mother found a knife and other items JEB was not allowed to possess in a backpack that belonged to him. JEB’s probation counselor filed a motion and affidavit asking the juvenile court to find a probation violation. At the probation violation hearing, JEB argued for the first time that the condition prohibiting him from possessing knives was invalid because it was not crime related. Specifically, he contended that his offenses did not involve any weapons and, therefore, it was improper for the juvenile court to impose a condition that prohibited him from possessing weapons that a 16 year old could otherwise legally possess. JEB asked the juvenile court to strike the condition. The juvenile court declined to rule on the validity of the supervision conditions. The juvenile court explained that JEB had not brought a motion to strike or remove the condition related to weapons, so the issue was not properly before the court. However, the juvenile court invited JEB to bring a written motion challenging the validity of the probation condition in the future, which would allow the State to respond in writing. 2 No. 54090-8-II The juvenile court determined that JEB had violated his supervision conditions and sentenced him to 25 days of detention, noting that he had several prior probation violations and lesser consequences had not been successful. On September 17, 2019, JEB appealed the juvenile court’s order imposing 25 days of detention. ANALYSIS JEB assigns error to the supervision condition prohibiting JEB from possessing knives: “There is no basis in the record for the probation condition prohibiting appellant from possessing knives.” Br. of Appellant at 1. But the juvenile court expressly declined to reach this issue in the probation violation hearing. The juvenile court said that this issue had not been properly presented to it, but the court invited JEB to bring a separate motion, in part so that the State would have an opportunity to respond. The record does not reflect whether JEB accepted the juvenile court’s invitation to bring a later motion. Instead, JEB appealed the juvenile court’s order finding that he had violated his supervision conditions and imposing 25 days of confinement. Because the juvenile court expressly did not reach the underlying validity of the relevant condition in its oral ruling or written order, the validity of the underlying condition prohibiting JEB from possessing weapons is not properly before this court. To the extent that JEB attempts to challenge the provisions in his order on adjudication and disposition prohibiting him from possessing dangerous weapons and requiring him to comply with written probation rules, the time for appealing that order has expired. Generally, a party must submit a notice of appeal within “30 days after the entry of the decision of the trial court that the 3 No. 54090-8-II party filing the notice wants reviewed.” RAP 5.2(a); Harley H. Hoppe & Assoc. v. King County, 162 Wn. App. 40 , 49, 255 P.3d 819 (2011). The juvenile court imposed the challenged condition in the order on adjudication and disposition on November 27, 2018. JEB’s notice of appeal in this case was filed too late to be a timely appeal of the November 2018 order. See RAP 5.2(a). Although JEB’s notice of appeal asserts he is appealing the superior court’s order finding a violation of his supervision conditions, JEB’s brief raises only the validity of his probation conditions that were imposed on November 27, 2018. Any attempt to appeal the order on adjudication and disposition is untimely. Accordingly, we dismiss JEB’s appeal. A majority of the panel having determined that this opinion will not be printed in the Washington Appellate Reports, but will be filed for public record in accordance with RCW 2.06.040, it is so ordered. Glasgow, J. We concur: Lee, C.J. Worswick, J. 4

2021-01-26 20:17:49.524537+00

http://www.courts.wa.gov/opinions/pdf/D2 53519-0-II Unpublished Opinion.pdf

Filed Washington State Court of Appeals Division Two January 26, 2021 IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON DIVISION II HENRY C. REITZUG, as his separate estate; No. 53519-0-II and MARK HADMAN and LISA HADMAN, husband and wife and the marital community comprised thereof, Respondents. UNPUBLISHED OPINION v. SKIPPER KUZIOR, Appellant. SUTTON, A.C.J. — Skipper Kuzior appeals the superior court’s three orders related to a dispute over the ownership of Henry Reitzug’s and Mark and Linda Hadmans’ properties. Reitzug and the Hadmans filed this lawsuit after Kuzior moved the fence separating their properties without their permission, and then removed the Hadmans’ hay from their property. The superior court granted the first motion for partial summary judgment in July 2018 for quiet title, ejectment, and trespass to establish the property line. The court granted a second partial summary judgment motion in March 2019 on Reitzug’s and the Hadmans’ amended quiet title claims. The court granted a third partial summary judgment in June 2019, awarding treble damages and attorney fees and litigation costs. Kuzior appeals and argues that the superior court erred by granting the orders for partial summary judgment and awarding treble damages and reasonable attorney fees and costs to Reitzug and the Hadmans. No. 53519-0-II We affirm the superior court’s orders1 and grant Reitzug’s and the Hadmans’ request for reasonable appellate attorney fees and costs. FACTS Henry Reitzug and his wife are the titled owners of real property in Graham, Washington. Mark Hadman and Lisa Hadman are the titled owners of adjacent property. Skipper Kuzior is the titled owner of property adjacent to both Reitzug’s and the Hadmans’ properties. In September 2017, Kuzior moved the wire fence separating his property from Reitzug’s and the Hadmans’ properties without consulting either Reitzug or the Hadmans. Mark Hadman attempted to speak with Kuzior, to no avail. Through counsel, Reitzug and the Hadmans sent a demand letter to Kuzior on December 4, 2017, but Kuzior did not respond. Because these efforts were fruitless, Reitzug and the Hadmans filed a complaint on February 15, 2018, seeking quiet title and ejectment, and claiming trespass. On June 15, 2018, Reitzug and the Hadmans moved for partial summary judgment on their claims of quiet title, ejectment, and trespass. As evidence, they presented a declaration from a professional land surveyor and their attorney. In response, Kuzior filed his declaration and included photographs, surveys, an unsworn letter from a professional land surveyor stating that two buildings were within Kuzior’s property boundaries, a declaration of annexation from 1978 regarding easements and covenants, and the various deeds. 1 The superior court’s partial summary judgment orders at issue are dated July 13, 2018, March 1, 2019, and June 1, 2019. Clerk’s Papers at 23-24, 27-28, 475-78. 2 No. 53519-0-II The superior court granted Reitzug’s and the Hadmans’ first motion for partial summary judgment for quiet title, ejectment, and trespass in July 2018. The court’s order quieted title to the area Kuzior claimed by relocation of the fence on Reizug’s and the Hadmans’ properties, and ordered that the fence be returned to its proper location. The court ordered Kuzior to “remove all fencing and other structures, livestock, and personal property that he has placed on [Reitzug’s and the Hadmans’] properties . . . and replace the boundary-line fence.” Clerk’s Papers (CP) at 24. During the time period between when Kuzior first moved the fence and when the court ordered him to move it back, Kuzior allowed his livestock to graze on the Hadmans’ land and mowed it without their permission. Due to this, the Hadmans were unable to cut their hay and either use or sell it, as they normally would do. The Hadmans estimated that the amount of hay they lost was about 50 bales, which they would have sold for $10 each. After Reitzug and the Hadmans filed their first motion for partial summary judgment, their counsel discovered in August 2018 that Kuzior had “re-recorded” a statutory warranty deed to his property. On the cover sheet, Kuzior listed the tax parcel numbers for Kuzior’s, Reitzug’s, and the Hadmans’ properties. Kuzior attached the December 2015 statutory warranty deed whereby the grantor purportedly granted Kuzior’s property to him. Kuzior also attached the declaration of annexation, which expands application of certain easements and covenants. In order to ensure proper title over their properties, Reitzug’s and the Hadmans’ counsel sent a letter to Kuzior demanding that he remove or render void the re-recorded deed, but he did not respond. Reitzug and the Hadmans then amended their complaint to incorporate a second claim to quiet title, as well as a claim for treble damages under RCW 4.24.630 and an award of attorney fees and litigation costs. 3 No. 53519-0-II In January 2019, Reitzug and the Hadmans filed their second motion for partial summary judgment on their amended quiet title claims and for trespass violations under RCW 4.24.630. As evidence, they included two declarations from their attorney, a declaration from Mark Hadman, and a declaration from Chicago Title Insurance Company. They attached as exhibits to these declarations the statutory warranty deeds for their properties, Kuzior’s re-recorded deed, and the letter sent to Kuzior. Kuzior did not meaningfully respond. The superior court ruled that Kuzior’s “re-record” of the statutory warranty deed to his property “creates no title, interest, or other right in any portion of [Reitzug’s or the Hadmans’] properties. CP at 28. The court also ruled that Kuzior violated RCW 4.24.630 when he removed hay and caused damages to Reitzug’s and the Hadmans’ properties during the time he occupied portions of their properties. Because there was no genuine issue of material fact and Reitzug and the Hadmans were entitled to judgment as a matter of law, in March 2019, the court granted Reitzug’s and the Hadmans’ second partial summary judgment motion, reserving the issue of damages.2 On May 23, 2019, Reitzug and the Hadmans filed a third motion for summary judgment requesting an award of treble damages and attorney fees and costs under RCW 4.24.630 and RCW 4.84.185, and CR 11 sanctions. They sought $1500 in treble damages ($500 tripled under RCW 4.24.360) for the value of the hay Kuzior removed from their property. Their counsel filed a declaration detailing her attorney fees and costs. 2 Kuzior filed a motion to reconsider, which the superior court denied. He then sought discretionary review, which we denied and ordered $500 in sanctions after finding his motion was frivolous. Ruling Denying Review, Reitzug v. Kuzior, No. 53119-4 (June 6, 2019). 4 No. 53519-0-II The superior court granted the third partial summary judgment motion on June 21, and ordered the following: 8. [Reitzug and the Hadmans] are entitled to treble damages and an award of reasonable attorney[] fees and litigation expenses pursuant to RCW 4.24.630. [Their] RCW 4.24.630 claim arises from the same nexus of facts as [their] trespass and first quiet-title action. Attorney fees and litigation expenses incurred relating to the RCW 4.24.630 cannot be reasonably segregated from fees and expenses relating to the other claims. 9. [Reitzug and the Hadmans] are entitled to reasonable attorney[] fees and litigation expenses pursuant to RCW 4.84.185, as [Kuzior’s] defenses against [their] claims were frivolous and advanced without reasonable cause. .... 12. The billing rates for the various attorneys and legal staff that performed work for [Reitzug and the Hadmans], as more fully set forth in [their] [m]otion and supporting [d]eclaration … are reasonable. 13. The [c]ourt has reviewed the billing records and believes that the time expended by [Reitzug and the Hadmans] in defending this case were reasonable. 14. The litigation expenses incurred by [Reitzug and the Hadmans] are reasonable. CP at 476-77. The superior court entered an award of treble damages in the amount of $1,500, attorney fees in the amount of $29,715.99, and litigation expenses in the amount of $1,736.49. Kuzior appeals the superior court’s three partial summary judgment orders. ANALYSIS I. STANDARD OF REVIEW We review a superior court’s summary judgment order de novo, performing the same inquiry as the superior court and viewing all facts and reasonable inferences in the light most favorable to the nonmoving party. Johnson v. Lake Cushman Maintenance Co., 5 Wn. App. 2d 5 No. 53519-0-II 765, 777, 425 P.3d 560 (2018). Summary judgment is appropriate where there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. CR 56(c). The moving party bears the initial burden of showing that there are no genuine issues of material fact. Johnson, 5 Wn. App. 2d at 777. To establish a genuine issue of material fact, the nonmoving party may not rely on speculation or argumentative assertions that unresolved factual issues remain; instead, it must set forth specific facts that sufficiently rebut the moving party’s contentions. Woodward v. Lopez, 174 Wn. App. 460 , 468, 300 P.3d 417 (2013). II. FIRST MOTION FOR PARTIAL SUMMARY JUDGMENT Kuzior argues that the superior court erred by granting Reitzug’s and the Hadmans’ first summary judgment motion for quiet title, ejectment, and trespass related to the property line and the fence line. We hold that the superior court properly granted quiet title and ejected Kuzior from Reitzug’s and the Hadmans’ properties, and ordered him to put the boundary fence back on the actual property line. A. QUIET TITLE Washington law provides in a quiet title action that “[t]he plaintiff . . . shall set forth in his or her complaint the nature of his or her estate, claim, or title to the property, and the defendant may set up a legal or equitable defense to plaintiff’s claims; and the superior title, whether legal or equitable, shall prevail.” RCW 7.28.120. A quiet title action is equitable and “‘designed to resolve competing claims of ownership’ to property.” Bavand v. OneWest Bank, F.S.B., 176 Wn. App. 475 , 502, 309 P.3d 636 (2013) (internal quotation marks omitted) (quoting Walker v. Quality Loan Serv. Corp., 176 Wn. App. 294 , 322, 308 P.3d 716 (2013)), abrogated on other grounds by Merry v. Northwest Trustee Serv., Inc., 188 Wn. App. 174 , 352 P.3d 830 (2015); see RCW 7.28.010. “An 6 No. 53519-0-II action to quiet title allows a person in peaceable possession or claiming the right to possession of real property to compel others who assert a hostile right or claim to come forward and assert their right or claim and submit it to judicial determination.” Kobza v. Tripp, 105 Wn. App. 90 , 95, 18 P.3d 621 (2001). Here, the evidence establishes that Reitzug and the Hadmans have statutory warranty deeds establishing title and ownership of their properties and that Kuzior had no authority to move the boundary fence line separating their properties. Kuzior relied on speculation and conjecture, which cannot be considered on summary judgment. See Woodward, 174 Wn. App. at 468. Kuzior presented no evidence that contradicted Reitzug’s and the Hadmans’ valid titles. Because Kuzior failed to establish any genuine issue of material fact and Reitzug and the Hadmans were entitled to judgment as a matter of law, we hold that the superior court properly granted partial summary judgment in its July 2018 order on their quiet title claims. B. EJECTMENT RCW 7.28.010, governing actions in ejectment and to quiet title, specifically confers the right of action on persons having a valid subsisting interest and a right to possession. “Encroachment occurs when one builds a structure on another’s land; it is a form of trespass.” Proctor v. Huntington, 169 Wn.2d 491 , 496, 238 P.3d 1117 (2010). Kuzior wrongfully moved the boundary fence and trespassed onto Reizug’s and the Hadmans’ properties. The superior court ordered Kuzior to move the boundary fence back to its actual location and ejected Kuzior from Reitzug’s and the Hadmans’ properties. Because there were no genuine issues of material fact as to ejectment or trespass, and Reitzug and the Hadmans 7 No. 53519-0-II were entitled to judgment as a matter of law, the superior court properly granted their partial summary judgment motion on their claims of ejectment and trespass. III. SECOND MOTION FOR PARTIAL SUMMARY JUDGMENT Kuzior argues that the superior court erred by granting the second partial summary judgment motion on Reitizug’s and the Hadman’s amended claims of quiet title, arising from Kuzior’s “re-recording” of his statutory warranty deed on his property. We hold that the superior court properly granted the second partial summary judgment motion on Reitzug’s and the Hadmans’ amended claims of quiet title on their properties. “RCW 64.04.010 requires that conveyances of an interest in property must be by deed.” OneWest Bank, FSB v. Erickson, 185 Wn.2d 43 , 69, 367 P.3d 1063 (2016). And “[e]very deed shall be in writing, signed by the party bound thereby, and acknowledged by the party before some person authorized by this act to take acknowledgments of deeds.” RCW 64.04.020 (reviser’s note omitted). Here, Kuzior filed a document which he titled “re-record to correct legal.” CP at 247. On the cover sheet, he listed the tax parcel numbers for Kuzior’s, Reitzug’s, and the Hadmans’ properties. He attached the December 2015 statutory warranty deed whereby the grantor granted Kuzior’s property to Kuzior. Kuzior also attached a declaration of annexation, which described certain easements and covenants. Kuzior fails to explain or establish how the “re-record” of the statutory warranty deed on his property gives him title to any portion of the properties owned by Reitzug or the Hadmans. The declaration of annexation he filed merely describes certain easements and covenants. 8 No. 53519-0-II Because Kuzior failed to establish a genuine issue of material fact, and Reitzug and the Hadmans are entitled to a judgment as a matter of law, we hold that the superior court properly granted the second partial summary judgment motion on Reitzug’s and the Hadmans’ amended claims of quiet title. IV. THIRD MOTION FOR PARTIAL SUMMARY JUDGMENT A. TREBLE DAMAGES—RCW 4.24.630 Kuzior argues that the superior court erred by awarding treble damages under RCW 4.24.630 to the Hadmans. We hold that the superior court properly awarded $1500 in treble damages under RCW 4.24.630 for the value of the hay. RCW 4.24.630(1) provides for an award of treble damages and states that [e]very person who goes onto the land of another and who removes timber, crops, minerals, or other similar valuable property from the land, or wrongfully causes waste or injury to the land, or wrongfully injures personal property or improvements to real estate on the land, is liable to the injured party for treble the amount of the damages caused by the removal, waste, or injury. For purposes of this section, a person acts “wrongfully” if the person intentionally and unreasonably commits the act or acts while knowing, or having reason to know, that he or she lacks authorization to so act.. “RCW 4.24.630 requires a showing that the defendant intentionally and unreasonably committed one or more acts and knew or had reason to know that he or she lacked authorization.” Clipse v. Michels Pipeline Constr., Inc., 154 Wn. App. 573 , 580, 225 P.3d 492 (2010). The superior court ruled that Kuzior had wrongfully removed the fence separating the parties’ properties, and ordered that it to be returned to its original location. The superior court also ruled that Reitzug and the Hadmans had valid titles and ownership of their properties and that Kuzior had no interest, claim, or ownership in these properties. The court ruled that it was 9 No. 53519-0-II undisputed that for the time period that Kuzior wrongfully moved the fence, he mowed and removed hay from the Hadmans’ property and allowed his animals to graze there. Kuzior trespassed onto the Hadmans’ property and wrongfully removed the hay. Kuzior knew or had reason to know that he did not have authorization to use the Hadmans’ property for his benefit. Clipse, 154 Wn. App. at 580. Kuzior should have known that he was using the Hadmans’ property without their authorization because the title to their property established that he was on their property. Because Kuzior failed to establish any genuine issues of material fact and the Hadmans were entitled to judgment as a matter of law, we hold that the superior court properly found Kuzior was liable for violations under RCW 4.24.630 and awarded $500 as the value of the hay, which amount it tripled for a total of $1500 in treble damages. B. ATTORNEY FEES AND COSTS Kuzior argues that the court erred by awarding Reitzug’s and the Hadmans’ reasonable attorney fees and costs in the third partial summary judgment order. We hold that the superior court properly awarded reasonable attorney fees and costs under RCW 4.24.630 and RCW 4.84.185. If a person is found liable under RCW 4.24.630, the prevailing party is entitled to an award of attorney fees and costs of litigation. RCW 4.24.630(1) states that [d]amages recoverable under this section include, but are not limited to, damages for the market value of the property removed or injured, and for injury to the land, including the costs of restoration. In addition, the person is liable for reimbursing the injured party for the party’s reasonable costs, including but not limited to investigative costs and reasonable attorneys’ fees and other litigation-related costs. 10 No. 53519-0-II “If . . . an attorney fees recovery is authorized for only some of the claims, the attorney fees award must properly reflect a segregation of the time spent on issues for which attorney fees are authorized from time spent on other issues.” Hume v. American Disposal Co., 124 Wn.2d 656 , 672, 880 P.2d 988 (1994). Segregation of attorney fees is not required where the claims are related. See Hume, 124 Wn.2d at 673 . RCW 4.84.185 provides that a court may order the nonprevailing party to pay the prevailing party’s reasonable expenses incurred if the nonprevailing party’s argument was frivolous. The decision to impose costs is vested in the sound discretion of the trial court. Kilduff v. San Juan County, 194 Wn.2d 859 , 876-77, 453 P.3d 719 (2019). Kuzior wrongfully moved the property boundary fence and unlawfully removed the Hadmans’ hay by mowing it and allowing his animals to graze there. The superior court properly determined the hay’s value to be $500, which amount it tripled as treble damages under RCW 4.24.630. Because the Hadmans had to show they had title to the land in order to prove trespass, their quiet title, ejectment, and trespass claims were so related that segregation of the attorney fees was not necessary. Kuzior had no factual or legal basis to move the boundary fence or trespass onto Reitzug’s and the Hadmans’ properties. Kuzior failed to present any material facts or legitimate arguments to support his argument that he had ownership over Reitzug’s and the Hadmans’ properties. Based on Kuzior’s actions, Reitzug and the Hadmans were forced to undergo extensive and costly litigation. 11 No. 53519-0-II Because Kuzior’s actions and defenses were frivolous and resulted in extensive and costly litigation, we hold that the superior court properly awarded reasonable attorney fees to Reitzug and the Hadmans in the amount of $29,715.99, and litigation expenses in the amount of $1,736.49 under RCW 4.24.360 and RCW 4.84.185. V. APPELLATE ATTORNEY FEES AND COSTS We grant Reitzug’s and the Hadmans’ request an award of appellate attorney fees and costs under RCW 4.24.630 and RCW 4.85.185. RAP 18.1(a) authorizes this court to grant an award of reasonable attorney fees and costs if authorized by applicable law. A court may award attorney fees and costs to the prevailing party under RCW 4.24.630. If the opposing party’s claims or defenses were frivolous or meritless, a court may award reasonable attorney fees and sanctions under RCW 4.84.185. On appeal, we agree with Reitzug and the Hadmans that Kuzior fails to make any cognizable argument and thus, his claims and defenses are frivolous. Because they are frivolous, we hold that Reitzug and the Hadmans are entitled to an award of reasonable appellate attorney fees and costs. CONCLUSION We affirm the superior court’s three partial summary judgment orders, and we grant Reitzug’s and the Hadmans’ reasonable appellate attorney fees and costs. 12 No. 53519-0-II A majority of the panel having determined that this opinion will not be printed in the Washington Appellate Reports, but will be filed for public record in accordance with RCW 2.06.040, it is so ordered. SUTTON, A.C.J. We concur: GLASGOW, J. CRUSER, J. 13

2012-04-17 06:25:01+00

http://bulk.resource.org/courts.gov/c/F3/71/71.F3d.882.94-8100.html

71 F.3d 882 U.S. v. Knox* NO. 94-8100 United States Court of Appeals, Eleventh Circuit. Nov 22, 1995 Appeal From: N.D.Ga., No. 93-00067-1-CR-2 1 AFFIRMED. * Fed.R.App.P. 34(a); 11th Cir.R. 34-3

2012-04-17 08:44:53+00

http://bulk.resource.org/courts.gov/c/F3/92/92.F3d.1185.95-3880.html

92 F.3d 1185 NOTICE: Sixth Circuit Rule 24(c) states that citation of unpublished dispositions is disfavored except for establishing res judicata, estoppel, or the law of the case and requires service of copies of cited unpublished dispositions of the Sixth Circuit. Benjamin AUSTIN; Vickie Austin, Co-Administrators of the Estate of Zachary Allen Austin, deceased, Plaintiffs-Appellants, v. CHILDREN'S HOSPITAL MEDICAL CENTER; Susan Hall, Defendants-Appellees, Xavier University, Defendant. No. 95-3880. United States Court of Appeals, Sixth Circuit. July 26, 1996. Before: MERRITT, Chief Judge; BROWN and SUHRHEINRICH, Circuit Judges. PER CURIAM. 1 In this diversity action, plaintiffs Benjamin and Vickie Austin allege that Children's Hospital Medical Center ("CHMC") and Susan Hall negligently exposed plaintiffs' son Zachary to a viral infection which resulted in Zachary's death. Plaintiffs appeal from the grant of summary judgment dismissing their cause of action. We conclude that plaintiffs failed to create a triable issue of fact on the issue of causation and AFFIRM the dismissal. BACKGROUND 2 Zachary Austin was born on November 11, 1990, in Alabama. Shortly after birth, Zachary was diagnosed with beta thalassemia major, a blood disorder which inhibits the production of red blood cells. The Austins elected to have Zachary undergo a bone marrow transplant at CHMC in Cincinnati. Zachary was admitted to CHMC on February 12, 1992, and the transplant was performed on February 28, 1992. 3 After the procedure, Zachary was placed in an isolation room. On March 10, 1992, Susan Hall, a student nurse from Xavier University, entered Zachary's room wearing a mask. Hall indicated at the time that she had a scratchy throat. Later that same day, Hall reentered Zachary's room to attend to Zachary, this time without a mask. Hall went home early that day with a fever. 4 Zachary subsequently developed signs of an infection. Cultures taken on March 13, 1992, tested positive for adenovirus. Zachary was treated for his adenovirus infection and discharged from CHMC. After traveling to his home in Alabama, Zachary had to be rehospitalized. Zachary died of a viral infection on May 17, 1992. 5 Plaintiffs, residents of Alabama, filed this action in federal district court in May 1993 alleging wrongful death under Ohio law. The initial named defendants were CHMC, Susan Hall, and Xavier University; plaintiffs subsequently settled with Xavier University. Diversity jurisdiction was proper pursuant to 28 U.S.C. § 1332. Defendants moved for summary judgment. Plaintiffs opposed, submitting the affidavit of Dr. Raff, a board certified physician in infectious diseases and Chief of the Section of Infectious Diseases at the University of Louisville School of Medicine. The district court granted summary judgment on the grounds that plaintiffs had failed to establish the cause or source of Zachary's infection. Plaintiffs timely appealed. ANALYSIS 6 We review the grant of summary judgment de novo, applying the same test as the district court. Ayoub v. National R.R. Passenger Corp., 76 F.2d 794, 795 (6th Cir.1996). Summary judgment is proper if the record, when viewed in the light most favorable to the nonmoving party, reveals that there are no genuine issues of material fact in dispute and that the moving party is entitled to judgment as a matter of law. Maldonado v. National Acme Co., 73 F.3d 642, 644 (6th Cir.1996). 7 To establish medical malpractice under Ohio law, the plaintiff must establish: (1) the existence of a standard of care within the medical community; (2) a breach of the standard of care by the defendant; (3) injury; and (4) direct and proximate causation. Littleton v. Good Samaritan Hosp. & Health Ctr., 529 N.E.2d 449 (Ohio 1988). 8 In the case at bar, plaintiffs introduced the affidavit of their expert witness, Dr. Raff, to establish the necessary elements of their wrongful death claim. Dr. Raff's affidavit on the issue of causation may be summarized as follows. Decedent tested negative for adenovirus antibodies indicating that he had not been exposed to adenovirus as of February 5, 1992. Decedent was shedding adenovirus and was febrile within three days of exposure to Susan Hall, the only person with symptomatic illness known to have been in contact with decedent. Based upon his education, training and experience, and his review of the record, Dr. Raff concluded that it was probable that decedent contracted the adenovirus from Susan Hall on March 10, 1992. Plaintiffs assert that Dr. Raff's affidavit creates a material issue of fact with respect to causation. 9 A plaintiff may not escape summary judgment merely by producing an expert witness. "If a court concludes that the evidence supporting the expert's position is insufficient to allow a reasonable juror to conclude that the position more likely than not is true, then the court remains free to prohibit the case from proceeding to the jury." Glaser v. Thompson Medical Co., 32 F.3d 969, 972 (6th Cir.1994) (citing Daubert v. Merrell Dow Pharmaceuticals, Inc., 113 S.Ct. 2786, 2798 (1993)). Although courts should be careful to respect scientific opinion, nevertheless courts apply a "hard look" to the reasoning of qualified scientific opinions to determine whether a triable issue has been created. Turpin v. Merrell Dow Pharmaceuticals, Inc., 959 F.2d 1349, 1252-53 (6th Cir.) (cited with approval in Daubert, 113 S.Ct. at 2798), cert. denied, 506 U.S. 826 (1992); Glaser, 32 F.3d at 972. Of course, an expert opinion which is conclusory and fails to set forth the underlying rationale is not adequate. Turpin, 959 F.2d at 1360. 10 Dr. Raff's affidavit suffers from numerous flaws. First, Dr. Raff states only that Hall's symptoms were "consistent" with an adenovirus. He fails to identify the basis for his subsequent conclusion that Hall in fact had adenovirus and not another ailment such as a fungal or bacterial infection. See Conde v. Velsicol Chem. Corp., 24 F.3d 809, 814 (6th Cir.1994) (holding insufficient showing of causation where testimony stated only that the symptoms were consistent with chlordane exposure without excluding other possible causes). Further, defendants introduced evidence that there are forty-two different recognized serotypes of adenoviruses, and that adenoviruses are ubiquitous and may be carried by individuals who are asymptomatic. Dr. Raff does not give his reasons for concluding that Zachary had the same serotype of adenovirus that Hall allegedly had, nor does he explain why he excluded the myriad of other potential sources of the adenovirus which infected Zachary. Cf. Glaser, 32 F.3d at 977-78 (holding expert testimony sufficient where expert engaged in differential diagnosis to reach his conclusion). 11 Indeed, the only identifiable reason for Dr. Raff's opinion appears to be post hoc, ergo propter hoc. This alone is not sufficient to create a material issue of causation. Abbott v. Federal Forge, Inc., 912 F.2d 867, 875 (6th Cir.1990); Hasler v. United States, 718 F.2d 202, 205 (6th Cir.1983), cert. denied, 469 U.S. 817 (1984). 12 We do not doubt that it is possible for Hall to have been the one to infect Zachary. Without evidence that this was more likely than not the case, however, the mere possibility of infection is not sufficient to avoid summary judgment. Hasler, 718 F.2d at 205 ("While an antibody antigen reaction can cause rheumatoid arthritis, there is no showing that it did cause the plaintiff's disease in this case."). CONCLUSION 13 The grant of summary judgment dismissing plaintiffs' wrongful death suit is AFFIRMED.

2020-12-01 23:00:53.03114+00

http://media.ca1.uscourts.gov/pdf.opinions/18-2133P-01A.pdf

United States Court of Appeals For the First Circuit No. 18-2133 UNITED STATES OF AMERICA, Appellee, v. JOMAR HERNÁNDEZ-ROMÁN, Defendant, Appellant. APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF PUERTO RICO [Hon. Daniel R. Domínguez, U.S. District Judge] Before Lynch, Selya, and Lipez, Circuit Judges. Jason González-Delgado on brief for appellant. W. Stephen Muldrow, United States Attorney, Mariana E. Bauzá- Almonte, Assistant United States Attorney, Chief, Appellate Division, and Alexander L. Alum, Assistant United States Attorney, on brief for appellee. December 1, 2020  SELYA, Circuit Judge. After a lengthy trial, a jury convicted defendant-appellant Jomar Hernández-Román of armed bank robbery and related crimes. Following the imposition of sentence, the defendant appeals. Concluding, as we do, that he is grasping at straws, we affirm the judgment below. I. BACKGROUND We sketch the relevant facts and travel of the case, taking those facts in the light most congenial with the verdict. See, e.g., United States v. Santiago, 83 F.3d 20 , 23 (1st Cir. 1996); United States v. Taylor, 54 F.3d 967 , 971 (1st Cir. 1995). On November 29, 2014, three armed individuals robbed a Banco Popular branch in Bayamón, Puerto Rico, making off with more than $64,000. In an attempt to distract the authorities, they had dropped packages containing fake bombs at ATMs outside of two other banks (one at Lomas Verde and one at Bayamón City Hall). Toward the end of the next month, the authorities detained the defendant. While in custody, he stated that on the day of the robbery, he and a friend ran some errands and went shopping for some sneakers. But this was not his first shopping trip: it turned out that four days earlier, he and an alleged coconspirator, José Padilla-Galarza (Padilla), had gone to two Party City stores and a Home Depot. In the course of this excursion, Padilla purchased various artifacts, including black gloves and fake facial hair, which a jury could reasonably have - 2 - concluded were used by the robbers.1 Video surveillance recordings from the stores' cameras corroborated these purchases. As the interview progressed, the defendant confessed. He admitted that he had hosted multiple meetings at his home, during which the plot to rob the bank was hatched. He also admitted that he had surveilled the bank on behalf of the conspirators; that he knew of the scheme to deploy fake bombs to divert the attention of the authorities; and that, after the robbery, he had returned a shotgun used by the robbers to Padilla. Another witness corroborated the fact that planning meetings had taken place at the defendant's home. In due season, a federal grand jury sitting in the District of Puerto Rico returned a five-count indictment that charged the defendant, Padilla, and three others with conspiracy to commit bank robbery (count 1), see 18 U.S.C. § 371 ; armed bank robbery (count 2), see id. § 2113(a); conspiracy to commit Hobbs Act robbery (counts 3 and 4), see id. § 1951(a); and using, carrying or brandishing firearms during and in relation to a crime of violence (count 5), see id. § 924(c). Three of these five defendants entered guilty pleas, but the defendant and Padilla maintained their innocence. After a protracted trial, the jury 1After the robbery, the authorities recovered a matching pair of black gloves and fake facial hair when executing a search warrant at Padilla's residence. - 3 - found the defendant guilty on all counts.2 The district court sentenced him to serve an eighty-seven-month term of immurement. This timely appeal followed. II. ANALYSIS In this venue, the defendant advances what can be grouped as two claims of error. We address them sequentially. A. Sufficiency-of-the-Evidence Claims. At the close of the government's case in chief, the defendant moved for judgment of acquittal. See Fed. R. Crim. P. 29(a). He argued that the government had failed to establish the interstate nexus required for the first four counts of the indictment and, in addition, had failed to prove that he "actually possessed a firearm during and in relation to a crime of violence." The district court denied his motion. The defendant did not renew his motion for judgment of acquittal at the close of all the evidence. See id. Nor did he move for judgment of acquittal following the jury's verdict. See Fed. R. Crim. P. 29(c)(1). Before us, he attempts to launch a broad-gauged series of sufficiency-of-the-evidence claims. Specifically, he submits that the government failed to prove either that he possessed the requisite criminal intent or that he was physically present during 2 The jury also found Padilla guilty on all counts, and his appeal is pending. - 4 - the commission of any crimes of violence. This attempt is doomed. The denial of a Rule 29(a) motion, without more, does not preserve an issue for appeal. See United States v. Maldonado-García, 446 F.3d 227 , 230 (1st Cir. 2006); United States v. Hadfield, 918 F.2d 987 , 996 (1st Cir. 1990). Here, there was no "more": the defendant's failure to move for judgment of acquittal either at the close of all the evidence or after the verdict was returned results in a waiver. See Maldonado-García, 446 F.3d at 230 . Given the absence of a timely Rule 29 (b) or (c) motion, an appellate court may not intercede except to prevent a clear or gross injustice. See United States v. Tkhilaishvili, 926 F.3d 1 , 18 (1st Cir. 2019); Taylor, 54 F.3d at 975 . There is no hint of any clear or gross injustice here. After all, it is common ground that there can be no clear and gross injustice if the evidence, scrutinized in the light most congenial with the verdict, can support a finding of guilt beyond a reasonable doubt. See Taylor, 54 F.3d at 974 . The evidence in this case easily clears so low a bar. We explain briefly. To sustain a conviction for conspiracy under 18 U.S.C. § 371 , "the government must furnish sufficient evidence of three essential elements: an agreement, the unlawful objective of the agreement, and an overt act in furtherance of the agreement." United States v. Hurley, 957 F.2d 1 , 4 (1st Cir. 1992). So, too, the government must furnish sufficient evidence of "the knowing - 5 - participation of each defendant in [the] conspiracy." United States v. Mubayyid, 658 F.3d 35 , 57 (1st Cir. 2011). The government's proof may be either direct or circumstantial. See United States v. Floyd, 740 F.3d 22 , 28 (1st Cir. 2014); United States v. Piper, 298 F.3d 47 , 59 (1st Cir. 2002). In the case at hand, the defendant admitted to hosting meetings at his home, during which the robbery was planned. He also admitted that he participated in surveilling the bank and that he delivered a shotgun that had been used in the robbery to one of his confederates. What is more, he admitted that he knew about the scheme to deploy fake bombs — and he even supplied the authorities with a diagram of the fake bombs. To cinch the matter, another of the charged coconspirators (Miguel Torres-Santiago) provided testimony that directly implicated the defendant as a member of the conspiracy. Assaying this evidence in light of the government-friendly standard of review, it was more than sufficient to sustain the defendant's conviction as to count one. Nor need we linger long over the defendant's importuning that the evidence was insufficient as to count two because he "simply did not participate in the bank robbery." The statute of conviction provides, in relevant part, that "[w]hoever, by force and violence, or by intimidation, takes, or attempts to take, . . . any property or money or any other thing of value belonging to . . . any bank," and who, in committing or attempting to commit - 6 - such an offense, "assaults any person, or puts in jeopardy the life of any person by the use of a dangerous weapon or device," commits the offense of armed bank robbery. 18 U.S.C. § 2113 (a), (d). At first blush, the evidence of each of these elements seems ample. The defendant demurs, saying that he did not participate in the robbery and that "none of the government witnesses who participated in this robbery could put [him] inside the bank." But the defendant is setting up a straw man: to convict the defendant under count two, the government was under no obligation to prove that he was physically present at the scene of the robbery. To the contrary, it is well-established that, by virtue of the jury's guilty verdict as to the conspiracy charged in count one, the defendant became substantively liable for the foreseeable acts of his coconspirators in furtherance of the conspiracy — including, in this case, the armed bank robbery. See Pinkerton v. United States, 328 U.S. 640 , 647 (1946). As we have said, "a Pinkerton instruction exposes a coconspirator to criminal liability for the substantive crimes committed in the course of the conspiracy, regardless of whether he or some other coconspirator actually perpetrated the crimes." United States v. Torres, 162 F.3d 6 , 10 (1st Cir. 1998). Consequently, the defendant need not have been physically present inside the bank - 7 - (or for that matter, in the vicinity of the robbery) in order to be guilty of the substantive crime of armed bank robbery. See id. Seen in this light, it is nose-on-the-face plain that the evidence was sufficient to enable a rational jury to conclude beyond a reasonable doubt that the defendant was a member of the bank-robbery conspiracy and, thus, liable for the substantive armed bank robbery charge. His own words are telling: he admitted to conducting surveillance to facilitate the robbery, to handling a shotgun used in the robbery, and to accompanying Padilla while he acquired disguises worn by the robbers. From the defendant's admissions and other evidence in the record, a rational jury could find without difficulty that the defendant had acted in furtherance of a foreseeable robbery. See United States v. Hurley, 63 F.3d 1 , 22 (1st Cir. 1995). The defendant also tries to attack his Hobbs Act convictions. As relevant here, the Hobbs Act proscribes conduct that "in any way or degree obstructs, delays, or affects commerce or the movement of any article or commodity in commerce, by robbery or extortion or attempts or conspires so to do." 18 U.S.C. § 1951 (a). Thus, the government was required to prove beyond a reasonable doubt both that the defendant conspired and attempted to commit robbery and that the conspiracy's actions affected interstate or international commerce. See Tkhilaishvili, 926 F.3d at 10. - 8 -  The defendant's challenge to his Hobbs Act robbery convictions falter for reasons similar to those that undermined his challenge to his bank robbery convictions. To be sure, the defendant asserts that the evidence fails to establish any actus reus on his part to employ "actual or threatened force, or violence," as required by the Hobbs Act.3 18 U.S.C. § 1951 (b)(1). This assertion, though, misses the mark. Upon the jury's finding that the defendant was a member of the bank-robbery conspiracy, he became subject to liability for the commission of the substantive offense which — under a Pinkerton theory of liability — he could have been held to have reasonably foreseen. See Torres, 162 F.3d at 10 . This leaves the firearms count (count 5). The defendant asserts that no rational jury could have found him guilty of violating 18 U.S.C. § 924 (c) because he did not physically possess any firearms during the robbery. Once again, the defendant is aiming at the wrong target. We have held that where, as here, Pinkerton liability is in play, "the defendant does not need to have carried the gun 3 On appeal, the defendant has abandoned the argument — originally advanced in his Rule 29(a) motion — that the government failed to prove a sufficient nexus with interstate commerce. And at any rate, the bank that the conspiracy targeted was federally insured, so a sufficient nexus with interstate commerce plainly existed. See United States v. Benjamin, 252 F.3d 1 , 9 (1st Cir. 2001) (holding that proof of federal insurance suffices to establish "at least a minimal impact on interstate commerce"). - 9 - himself to be liable under section 924(c)." United States v. Flecha-Maldonado, 373 F.3d 170 , 179 (1st Cir. 2004). Although the defendant may not have handled a firearm during the course of the robbery, the evidence makes manifest that he knew that firearms would be used at that juncture. Consequently, a rational jury could find — as this jury did — that the defendant was guilty of the firearms charge. That ends this aspect of the matter. Given the evidence of record and the reasonable inferences therefrom, we are satisfied that nothing resembling a clear and gross injustice mars the defendant's convictions. B. Claims Specific to the Firearms Offense. The defendant has another shot in his sling. Section 924(c) provides, in relevant part, that "any person who, during and in relation to any crime of violence . . . uses or carries a firearm, or who, in furtherance of any such crime, possesses a firearm, shall . . . be [punished as provided]." 18 U.S.C. § 924 (c)(3). Section 924(c)(3) then furnishes alternate definitions for the term "crime of violence": a felony that "(A) has as an element the use, attempted use, or threatened use of physical force against the person or property of another," (the force clause) 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 committing the offense" (the residual - 10 - clause). Id.; see King v. United States, 965 F.3d 60 , 64-65 (1st Cir. 2020). In this instance, the defendant first challenges his conviction on the firearms count on the ground that the residual clause contained in the statutory "crime of violence" definition is unconstitutionally vague. In support, he notes that the Supreme Court has invalidated the residual clause of the Armed Career Criminal Act (ACCA), see Johnson v. United States, 576 U.S. 591 , 596-97 (2015), and the residual clause contained in a section of the Immigration and Nationalization Act (INA), see Sessions v. Dimaya, 138 S. Ct. 1204 , 1216 (2018), as unconstitutionally vague. The defendant posits that section 924(c)'s residual clause, which mimics the residual clauses of the ACCA and the INA, is also unconstitutionally vague in light of Johnson and Dimaya. The government counters that the defendant was convicted on all of the charged counts and that several of those counts involved predicate offenses (specifically, armed bank robbery and Hobbs Act robbery) that qualify as crimes of violence under section 924(c)'s force clause. Given this circumstance, the government says, the defendant's conviction on the firearms count is unimpugnable. Because the defendant advances this claim of error for the first time on appeal, our review is for plain error. See United States v. Duarte, 246 F.3d 56 , 57 (1st Cir. 2001). Plain error review demands four showings: "(1) that an error occurred - 11 - (2) which was clear or obvious and which not only (3) affected the defendant's substantial rights, but also (4) seriously impaired the fairness, integrity, or public reputation of judicial proceedings." Id. at 60 . The proponent of plain error "must carry the devoir of persuasion as to each of these four components." United States v. Kilmartin, 944 F.3d 315 , 330 (1st Cir. 2019). We recently had occasion to confront a nearly identical claim of error. See United States v. García-Ortiz, 904 F.3d 102 , 105-07 (1st Cir. 2018). On that occasion, we held that any conceivable infirmity in the residual clause of section 924(c) offered the defendant no avenue for relief when the predicate offense qualified as a crime of violence under one of the other clauses of the statutory definition. See id. at 106 (finding that Hobbs Act robbery constituted crime of violence within the purview of section 924(c)'s force clause). For present purposes, we assume — as the defendant posits — that the residual clause of section 924(c) is unconstitutionally vague. See Johnson, 576 U.S. 596 -97. Nevertheless, both Hobbs Act robbery and armed bank robbery qualify as crimes of violence under the force clause of section 924(c). See García-Ortiz, 904 F.3d at 107 (Hobbs Act robbery); Hunter v. United States, 873 F.3d 388 , 390 (1st Cir. 2017) (armed bank robbery). As a result, any constitutional shortcoming in section 924(c)'s residual clause does not cast doubt upon the defendant's section 924(c) conviction. - 12 -  In a variation on this theme, the defendant claims that he is entitled to a new trial because the jury did not make a specific finding as to which of the first four counts comprised the predicate offense for the count five firearms conviction. This claim was not raised below and, thus, engenders plain error review. See Duarte, 246 F.3d at 57 . The Second Circuit has squarely addressed such a claim. It affirmed a section 924(c) conviction, holding that "[b]ecause the jury validly reached a unanimous guilty verdict on every predicate crime alleged," any error in the jury instructions "was necessarily harmless." United States v. Gomez, 580 F.3d 94 , 103- 04 (2d Cir. 2009). Accordingly, the instruction — even if erroneous — did not affect the defendant's substantial rights. See id. at 104 . So it is here. The jury found the defendant guilty of two counts relating to armed bank robbery and two counts relating to Hobbs Act robbery — all of which qualify as crimes of violence under section 924(c). It follows inexorably that, even though it may have been error for the district court not to have required the jury to reach consensus on a single predicate offense — a matter on which we take no view — any such error was harmless (and, thus, not plain). In a final jeremiad, the defendant implores us to reverse his firearms conviction because section 924(c) is a "rotten - 13 - statutory disposition," which he regards as "unduly unfair and inconsistently applied." This pejorative claim is entirely undeveloped, and we have held before that "issues adverted to in a perfunctory manner, unaccompanied by some effort at developed argumentation, are deemed waived." United States v. Zannino, 895 F.2d 1 , 17 (1st Cir. 1990). This is a paradigmatic example of such a case. III. CONCLUSION We need go no further. For ought that appears, the defendant was fairly tried and justly convicted. The judgment below is, therefore, Affirmed. - 14 -

2020-03-05 23:06:46.173601+00

https://www.courts.mo.gov/file.jsp?id=151413

In Re the Marriage of: ) CRAIG ANTHONY BELTO, ) ) Respondent, ) ) vs. ) No. SD36075 ) Filed: March 5, 2020 CASIE DENISE WHITE-BELTO, ) ) Appellant. ) APPEAL FROM THE CIRCUIT COURT OF CAMDEN COUNTY Honorable Aaron G. Koeppen, Judge AFFIRMED Casie Denise White-Belto (“Wife”), appeals the judgment 1 of the trial court denying her “Motion to Set Aside Judgment and Decree of Dissolution.” In one point, Wife asserts the trial court erred in denying her motion because she “established defenses and good cause as required by Supreme Court Rule 74.05.” 2 Finding no merit to Wife’s point, we affirm the judgment of the trial court. 1 “Because a motion to set aside a default judgment is an independent action, a judgment granting or denying such a motion is a final judgment eligible for immediate appellate review.” Paes v. Bear Communications, LLC, 568 S.W.3d 52 , 58 (Mo.App. W.D. 2019) (internal quotation and citation omitted). 2 All rule references are to Missouri Court Rules (2019).  Facts and Procedural History On January 10, 2018, Husband filed a “Petition for Dissolution of Marriage,” “Statement of Marital and Non-Marital Property and Liabilities of Petitioner,” “Income and Expense Statement of Petitioner,” and “Proposed Parenting Plan.” Wife was served with the petition and associated documents on January 15, 2018. Wife thereafter filed a verified Answer (along with her own “Statement of Income and Expenses,” “Statement of Property and Debt and Proposed Separation Agreement,” and proposed “Parenting Plan”) on February 20, 2018. Wife filed an updated Statement of Income and Expenses on September 28, 2018. Wife appeared in person (and pro se) at several hearings, including the commencement of a trial on the merits of the dissolution action on October 1, 2018 (the trial was cancelled midway through as the judge recused and transferred the case to another division). On November 29, 2018, Wife appeared at a case review hearing, and agreed to the case being reset for trial on February 25, 2019. Wife retained counsel on February 21, 2019, and on the following day—i.e., the Friday preceding the trial scheduled for Monday, February 25, 2019— Wife’s newly retained counsel filed an entry of appearance and a motion for continuance. At trial on February 25, 2019, neither Wife nor her counsel appeared. On the record, the trial court noted counsel’s entry of appearance and motion for continuance, but that the motion had not been noticed up for hearing, and that Wife’s counsel had not appeared to argue the motion. The trial court observed that Wife had filed an answer to Husband’s petition, and directed that “[t]he Court will require evidence to be presented.” The guardian ad litem (previously appointed on behalf of the children born of the marriage) and Husband testified. On March 7, 2019, the trial court entered its “Findings of Fact, Conclusions of Law and Judgment and Decree of Dissolution of Marriage.” On March 10, 2019, Wife filed a “Motion to 2 Set Aside Judgment and Decree of Dissolution of Marriage,” requesting the trial court set aside the “default judgment” because Wife had a “meritorious defense” and “good cause” for the judgment to be set aside under Rule 74.05(d). On April 8, 2019, the trial court heard argument on Wife’s motion and denied the same. 3 This appeal followed. Standard of Review We will affirm the judgment of the trial court in a bench-tried case unless it is not supported by substantial evidence, it is against the weight of the evidence, or it erroneously declares or applies the law. Murphy v. Carron, 536 S.W.2d 30 , 32 (Mo. banc 1976). “A motion to set aside a default judgment is treated as an independent action, which, on appeal, is reviewed for an abuse of discretion.” Wooten v. Wentworth Entm’t Group, LLC, 552 S.W.3d 118 , 121 (Mo.App. S.D. 2018). Analysis In her sole point relied on, Wife argues that “[t]he trial court erred and abused its discretion in denying Wife’s Motion to Set Aside Judgment and Decree of Dissolution because Wife established meritorious defenses and good cause as required by Supreme Court Rule 74.05.” 4 3 We observe that Wife did not file a motion for new trial, nor did she assert on appeal any error in denying the motion for continuance, or any error in the dissolution judgment by the trial court. 4 We direct Wife’s counsel to Rule 84.04(d): (1) Where the appellate court reviews the decision of a trial court, each point shall: (A) Identify the trial court ruling or action that the appellant challenges; (B) State concisely the legal reasons for the appellant’s claim of reversible error; and (C) Explain in summary fashion why, in the context of the case, those legal reasons support the claim of reversible error. The point shall be in substantially the following form: “The trial court erred in [identify the challenged ruling or action], because [state the legal reasons for the claim of reversible error], in that [explain why the legal reasons, in the context of the case, support the claim of reversible error].” 3  This line of argument is unavailing. The decree of dissolution was a judgment on the merits, and not (as Wife’s argument errantly presumes) a default judgment subject to challenge via Rule 74.05. It is well-established that Rule 74.05(d)’s prerequisites for a motion to set aside are inapplicable when the record shows that the defendant pleaded an answer to the petition or otherwise defended against the petition. Even a defendant’s timely attempt to file pleadings has been held sufficient for otherwise defending per Rule 74.05(d). In such instances, a judgment entered is not a default judgment, but is a judgment on the merits. Bramer v. Abston, 553 S.W.3d 872 , 880–81 (Mo.App. S.D. 2018) (internal quotations and citations omitted). The record reflects the following timeline (as applicable to Wife’s challenge): •January 10, 2018: Husband’s Petition for Dissolution of Marriage (and associated documents) filed. •January 15, 2018: Wife served with process. •February 20, 2018: Wife filed an answer, and filed her own Statement of Income and Expenses, Statement of Property and Debt and Proposed Separation Agreement, and proposed Parenting Plan. •August 23, 2018: Wife ordered to submit to urine and hair follicle drug testing; she underwent drug testing. •September 20, 2018: (Docket Entry). “Case called. Attorney O’Donnell appears for Petitioner. GAL Birdsong appears. Respondent appears in person. Court takes up Motion to Release Test Results. Respondent provided drug test results to other parties in open court. Case to remain set for October 1, 2018 at 9:00 a.m.” (Emphasis added). •September 28, 2018: Wife filed a “Motion for Additional Time” to find an attorney, and an updated Statement of Income and Expenses. 4  •October 1, 2018: (Docket entry): “Case called. Attorney O’Donnell appears with Petitioner. Respondent appears in person pro se. GAL Birdsong appears. Parties announce they are ready to proceed. Petitioner begins direct exam and Court has determined that it needs to recuse. Division IV recuses. Case transferred to Division V per local court rule.” (Emphasis added). •November 29, 2018: (Docket Entry): “Case called. Atty Deirdre O’Donnell appears on behalf of Petitioner. Respondent appears in person and Pro Se. Cause is set by agreement on February 25, 2019 for Trial.” (Emphasis added). •February 22, 2019: entry of appearance and motion for continuance 5 filed by attorney on behalf of Wife •February 25, 2019: (Docket Entry): “Case Called. Petitioner appears in person and with Atty Deirdre O’Donnell. Respondent appears not. Atty for Respondent Rachel Russell appears not. Motion for Continuance was filed, but not properly noticed up, therefore motion for continuance is not taken up. Atty Staci Birdsong is present as Guardian Ad Litem. Matter is placed on the record. Evidence is adduced. Recommendation/Sworn statement is made by Atty Birdsong. Dissolution is granted. Findings are announced. Atty O’Donnell to submit proposed judgment to the Court within 10 days.” •March 7, 2019: The trial court entered “Findings of Fact, Conclusions of Law and Judgment and Decree of Dissolution of Marriage.” •March 10, 2019: Counsel for Wife filed her Rule 74.05(d) “Motion to Set Aside Judgment and Decree of Dissolution of Marriage.” •April 8, 2019: Hearing held on Wife’s Rule 74.05(d) motion. •April 9, 2019: Trial court denied Wife’s motion. 5 The motion for continuance filed on February 22, 2018, indicated (in relevant part) as follows: “[u]ndersigned counsel was only retained yesterday and is unprepared to adequately advocate in a court trial”; “[t]he timing of undersigned counsel’s retention was not done as a delay tactic or a strategic maneuver. [Wife] resides in a shelter and was originally set to receive legal funding. . . . When that funding fell through, [Wife] attempted to find pro bono legal services but was again denied services. [Wife] was then referred to undersigned counsel and had to gather finances for the retainer”; “[u]ndersigned counsel needs time to get acquainted with the case, advise [Wife] of her options, and potentially reach a settlement”; and “undersigned counsel had previously been scheduled for a pre-trial conference for a murder trial in Saline County on February 25th and cannot appear [for trial in the Belto trial].” This motion for continuance was not verified. See Rule 65.03. We nevertheless observe that this requirement is sometimes—though not always—foregone without incident in practice, and that the trial court did not rely on the verification deficiency in denying counsel’s request for continuance. 5  As this record demonstrates, Wife “pleaded an answer to [Husband’s] petition,” and “otherwise defended against the petition”—the judgment and decree of dissolution was on the merits. Bramer, 553 S.W.3d at 880 –81. As such, Wife’s Rule 74.05(d) motion (erroneously premised on the challenge of a default judgment) was misplaced. Wife fails to demonstrate that the trial court abused its discretion in denying her request to obtain relief via the procedural mechanism for default judgments (Rule 74.05), where the judgment was actually on the merits. Point denied. The judgment of the trial court is affirmed. WILLIAM W. FRANCIS, JR., J. – OPINION AUTHOR GARY W. LYNCH, P.J. – CONCURS NANCY STEFFEN RAHMEYER, J. – CONCURS 6

2021-01-26 20:00:21.7572+00

http://www.ca4.uscourts.gov/Opinions/186916.P.pdf

PUBLISHED UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT No. 18-6916 CHARLES NEMON VANDROSS, Petitioner - Appellant, v. BRYAN STIRLING, Commissioner, South Carolina Department of Corrections, and Broad River Correctional Institution, Respondent - Appellee. Appeal from the United States District Court for the District of South Carolina, at Aiken. Richard Mark Gergel, District Judge. (1:17-cv-02484-RMG) Argued: October 28, 2020 Decided: January 26, 2021 Before NIEMEYER, MOTZ, and RICHARDSON, Circuit Judges. Affirmed by published opinion. Judge Niemeyer wrote the opinion, in which Judge Motz and Judge Richardson joined. ARGUED: E. Charles Grose, Jr., GROSE LAW FIRM, LLC, Greenwood, South Carolina, for Appellant. Michael Douglas Ross, OFFICE OF THE ATTORNEY GENERAL OF SOUTH CAROLINA, Columbia, South Carolina, for Appellee. ON BRIEF: Elizabeth A. Franklin-Best, BLUME FRANKLIN-BEST & YOUNG, LLC, Columbia, South Carolina, for Appellant. Alan Wilson, Attorney General, Donald J. Zelenka, Deputy Attorney General, Melody J. Brown, Senior Assistant Deputy Attorney General, J. Anthony Mabry, Assistant Attorney General, OFFICE OF THE ATTORNEY GENERAL OF SOUTH CAROLINA, Columbia, South Carolina, for Appellee. NIEMEYER, Circuit Judge: In his application for a writ of habeas corpus filed under 28 U.S.C. § 2254 , Charles Vandross — who was convicted in a South Carolina state court for murder, burglary, kidnapping, and related crimes — claimed that his trial counsel’s performance was constitutionally deficient under the standard established in Strickland v. Washington, 466 U.S. 668 (1984). He noted that his trial counsel failed to call any forensic experts to testify on his behalf and asserted that such failure was not a strategic decision but was made out of counsel’s ignorance of the availability of funding to pay experts. He asserted further that his post-conviction counsel’s performance was also constitutionally deficient in failing to demonstrate that his trial counsel’s deficiency was prejudicial. The district court granted summary judgment to the State because Vandross failed to show prejudice not only in the state post-conviction court but also in the district court. We granted a certificate of appealability on the ineffective-assistance issue and now affirm. Even though the district court did not restrict its review by considering only the state court record, as required in the circumstances, but instead considered an affidavit of a forensic expert that Vandross presented for the first time in the district court, we nonetheless agree with the district court’s conclusion that the expert failed to show prejudice with evidence or a proffer of evidence “of what a defensive forensic expert would have testified to and how that could have altered the trial.” The forensic expert only identified investigatory issues that he or another forensic expert could have explored and did not test or challenge any evidence actually presented to the jury so as to support a 2 conclusion that testimony from him or another forensic expert could have made a difference. I The proof against Vandross at his state trial in Greenwood County, South Carolina, consisted mostly of the testimony of his former girlfriend, JoAnn Suber Wilson, and forensic evidence that corroborated some of her testimony. Generally, Wilson testified that following an argument with Vandross, Vandross broke into her house, murdered the man whom Wilson was then with, and then kidnapped her at gunpoint. More particularly, Wilson testified that after she and Vandross began dating in July 2003, Vandross moved into her house, and the two lived together on and off for the next 12 to 14 months. Eventually, though, he moved into his own apartment nearby, but he kept a key to Wilson’s house. He also gave Wilson a key to his apartment. After an argument on October 31, 2004, Wilson asked Vandross to leave her house, and he did so, but he kept her key. Because she became scared of Vandross, she asked a prior boyfriend, Sanford Best, to stay with her in her house, and he agreed. The next day, on November 1, Vandross went to Wilson’s workplace, and the two exchanged keys. Two days later, on November 3, Wilson received a call from a friend that prompted her that same day to seek a restraining order against Vandross. She received a no-trespassing notice. Later that day, when she and Best were watching her son’s ball game, she saw Vandross, and he just “stare[d]” at them. 3  During that night, after Wilson and Best had gone to sleep in the same bed, Wilson was awakened by Vandross’s hand over her mouth and a gun pointed to her head. Vandross warned her that she “better not scream.” As Wilson resisted, a tussle resulted, and Vandross threw Wilson violently to the floor, bruising her and causing bleeding from her nose and mouth. She stopped resisting only after Vandross threatened to “include [her] children in it.” When Vandross let Wilson use the bathroom after she had pleaded with him that she really needed to go, she took some of the blood from her wounds and attempted to write Vandross’s name on the bathroom wall. She explained that she did so because she believed that Vandross was going to kill her. Vandross then threw her some of her clothes to get dressed and a roll of duct tape that he had brought with him, instructing her to put the tape over her mouth. While she did so, she spit on the tape so that it would be loose and could be removed more easily. She also left pieces of tape in the bathroom as “clues.” When Vandross saw Wilson through the open door spitting on the tape, he wrapped the tape around her head “all the way down to [her] neck.” She could barely breathe, as only one nostril was left open. Vandross then pushed Wilson back through the bedroom into the living room, and as they passed through the bedroom, Wilson testified that “out of the corner of [her] eye,” she saw Best on the bed “with a pillow over his head.” Vandross grabbed Wilson’s car keys, led her through the back door, and put her into the driver’s seat of her car, while taking the passenger seat. He then instructed Wilson to drive, even though she was complaining about her restricted ability to do so with the duct tape wrapped about her face. 4  Following Vandross’s instructions, Wilson pulled the car into a church parking lot. But when they saw the lights on in two nearby houses, one of which was a parsonage, Vandross told Wilson, at gunpoint, to drive to a second church. After entering its parking lot, she attempted to run the car into a silver tank, but Vandross hit the brake and stopped the car. He grabbed the keys, put the car in park, and ripped the duct tape off of Wilson as he started “ranting and raving” about prior arguments during their relationship. It was now about 3:00 a.m. on November 4. Vandross related details of their past, expressed jealousies, and stated that he loved her but she didn’t love him. He continued his monologue, stating, “My life is ruined, I’ve killed a man.” When Wilson insisted that she did love him and recalled how he had said that their “hugs [were] special,” she invited a hug from Vandross. He then pulled Wilson out of the car, hugged her, and started to quote scripture. She nonetheless started praying, believing still that he was about to kill her. As Vandross’s temperament thus flipped, he told Wilson that he would never hurt her. He “pulled the clip out of the gun,” put it in his pocket, and said, “Let’s get back in the car.” Observing that it was “5:50” and “time for the kids to get up,” he stated that he would take her back to the house if she promised to do certain things, including taking the children outside in time for the school bus and not telling the police. During this discourse, he observed that he expected to be sentenced to only “eight to ten years for this” because it was his “first offense.” When Wilson suggested that they call the police because Best might not be dead, Vandross replied, “Trust me, he’s dead.” Wilson drove them back to her house, and while still parked, he instructed her to take off her outer shirt, combed her hair with his fingers, and cleaned some of the blood 5 off of her face with saliva, as one would do for a child. Wilson then went inside, woke up her sons, and got them dressed. But while inside, she also called the police. She then took her boys out front to wait for the bus. Once she heard sirens, however, she and the boys ran to meet the police. Officer Chris Hammett testified that he found Vandross standing on Wilson’s back porch. Following Hammett’s command, Vandross handed over the unloaded gun, and the officer found the clip in Vandross’s pants pocket. Officer James Boggs testified that, inside the house, the bedroom TV was “very loud” and that Best was lying dead on the bed with a gunshot wound to his head. Wilson testified at trial that she had never heard the gunshot. To corroborate Wilson’s testimony, the State presented forensic evidence analyzing evidence collected from the scene by an evidence technician. The technician collected a gun residue kit from Vandross, and the subsequent test indicated that lead particles were on Vandross’s shirt but that there was no detectable amount of the other two chemicals necessary to classify those particles as gunshot residue. No tests were conducted for gun residue on Wilson. The State also conducted a series of DNA tests. A test of the gun recovered from Vandross did not reveal any DNA on the gun. Pieces of duct tape from Wilson’s car had Wilson’s DNA on them but not any blood or DNA from Vandross. Similarly, a test of the duct tape roll revealed Wilson’s DNA on it but not Vandross’s. Samples of blood taken from the bathroom belonged to Wilson. A test of Vandross’s pants had Wilson’s DNA on them. 6  A white shirt was recovered from the floor of Wilson’s car, which had red or brown stains on it, as well as a smudge that could have been a handprint. While the technician testified that he did not know if the shirt had been submitted to testing, a DNA analyst testified that a test of the shirt found blood belonging to Best. The technician found a stocking cap on the back porch of Wilson’s house, but it was never tested. He did not attempt to collect any fiber, hair, or fingerprint evidence in the house because Vandross was known to have been a recent resident. A firearms expert testified that the gun recovered from Vandross was the same gun that fired the bullet that killed Best, and the technician collected a shell casing from the floor next to the bed. A forensic pathologist analyzed Best’s gunshot wound and testified that the abraded skin around the hole indicated that the gun was against the skin when fired. He stated further that the gun taken from Vandross was consistent with the wound. Finally, he testified that based on his own experience of firing pistols, it “would not be unusual” for someone in the same room not to hear a gunshot when it is fired directly against the skin. During closing argument at trial, Vandross’s attorney highlighted the gaps in the forensic evidence, pointing out that testing did not identify any of Best’s DNA on Vandross’s hands, clothing, or gun. He similarly highlighted the absence of Vandross’s DNA on the duct tape. Finally, he argued that the shell casing’s location was not consistent with where Vandross would have stood to shoot Best. Following the jury’s guilty verdict, Vandross appealed, and the South Carolina Court of Appeals affirmed his conviction. Vandross then applied to the Greenwood County 7 Court for post-conviction relief (“PCR”), claiming, among other things, the ineffective assistance of his trial counsel in failing “to hire and interview or call to testify experts,” listing experts in eight distinct disciplines. He contended that his counsel’s ineffective assistance violated his rights under the Sixth Amendment, citing Strickland v. Washington, 466 U.S. 668 (1984). At the PCR hearing, Vandross’s trial counsel testified that he did not hire any experts to testify at trial or advise him because, even though he “thought it would be very beneficial to us,” he did not have the funds to do so and, he added, neither did Vandross. Vandross did not present any expert testimony at the PCR hearing to support his claim of prejudice resulting from this alleged ineffective assistance of counsel at trial because, as he testified, “we probably would have to pay for that” and “we could not guarantee what we would find.” The state PCR court denied Vandross’s PCR application on the merits, explaining, as to trial counsel’s failure to call any expert witnesses: Counsel testified he wanted to retain experts in this case, but Applicant had no funds with which to hire these experts. Counsel also testified he used the prior trial transcripts to fully cross-examine the witnesses, especially Wilson. Prejudice from trial counsel’s failure to call witnesses cannot be shown where the witnesses do not testify at post-conviction relief. An Applicant must produce the testimony of a favorable witness or otherwise offer the testimony in accordance with the rules of evidence at the PCR hearing in order to establish prejudice from the witness’ failure to testify at trial. Applicant produced no such testimony of any expert witnesses at the PCR hearing, and therefore cannot show any resulting prejudice. (Citations omitted). On July 24, 2017, the Supreme Court of South Carolina denied Vandross’s petition for a writ of certiorari to review the PCR court’s ruling. 8  Vandross then filed this § 2254 application in the district court on September 15, 2017, making several claims, including that he received the ineffective assistance of counsel at trial “when trial counsel failed to obtain funding for expert witnesses.” Amplifying that claim in his application, he stated: Petitioner’s trial counsel never consulted or secured any experts for either of Petitioner’s murder trials because he did not know that he could secure funding for them. Given the State’s heavy reliance on forensic testimony, and the two prior [trials based on hung juries], counsel’s performance was objectively both deficient and prejudicial. Vandross asserted that his trial counsel did not make a strategic choice about the need for experts; indeed, his trial counsel conceded, when testifying at the PCR hearing, that experts would have been “very beneficial” to Vandross. Vandross argued further that the district court should not deny his application on the basis of the state’s PCR ruling because his counsel in that proceeding was also ineffective. He maintained that “the procedural default” in failing to show prejudice at his state PCR hearing should be excused because state PCR counsel was ineffective in failing to hire experts to show prejudice, relying on Martinez v. Ryan, 566 U.S. 1 , 17 (2012) (holding that, in limited circumstances, cause to excuse procedural default might be established by ineffective counsel in state collateral proceedings). The district court approved funding for Vandross to retain a forensic expert to support his § 2254 application, and Vandross retained Dr. Rodger Morrison. Dr. Morrison submitted a two-page affidavit, which identified 14 investigatory issues that a forensic expert could have addressed at trial. He did not, however, test any evidence, concluding 9 only that if trial counsel had retained a forensic expert, “it would have undermined the integrity of the State’s case against Mr. Vandross.” By order dated July 20, 2018, the district court granted the State’s motion for summary judgment. It agreed with the state PCR court that Vandross failed to establish prejudice from his trial counsel’s alleged ineffective assistance because he offered no expert testimony at the PCR hearing to support his claim. The court concluded further that Dr. Morrison’s affidavit did not demonstrate prejudice because it “fail[ed] to offer any substantive testimony that would have served to challenge the evidence offered by the state” at trial. Vandross filed this appeal from the district court’s order, and on February 4, 2019, we granted a certificate of appealability as to his claim of ineffective assistance of trial counsel for failing to retain experts and present expert testimony at trial. II In his § 2254 application, Vandross claims that he received the ineffective assistance of counsel at trial “when trial counsel failed to obtain funding for expert witnesses.” He maintains that his counsel did not make a strategic choice about the need for experts; indeed, his counsel conceded that he believed experts would have been “very beneficial” to Vandross. His counsel explained that he did not retain experts because neither he nor Vandross could afford to pay for them. Counsel was apparently unaware of a South Carolina statute that provides funding to indigent defendants for exactly this purpose. See S.C. Code Ann. § 17-3-50 (B) (authorizing up to “five hundred dollars” to pay for 10 investigation and experts to assist certain indigent defendants). Vandross asserts that such an elementary mistake of law constitutes deficient performance. See Hinton v. Alabama, 571 U.S. 263 , 273 (2014) (per curiam) (finding deficient performance where trial counsel’s failure to seek additional funds for an expert witness “was based not on any strategic choice but on a mistaken belief that available funding was capped”). He also asserts that this deficiency prejudiced him at trial because experts could have testified about evidentiary holes in the State’s case, which could have altered the ultimate outcome. But this is the same claim that Vandross presented to the state PCR court and that the state court resolved on the merits. Vandross claimed in his state PCR application that he received the ineffective assistance because his counsel failed “to hire and interview or call to testify experts” in numerous distinct disciplinary areas to counter the State’s evidence, including an “expert on guns,” a “doctor or blood expert,” a “handprint expert,” a “clothing expert,” and a “psychiatrist.” And he claimed that he “was prejudiced by counsel’s failure.” Finally, he argued that “in every instance of ineffective assistance of counsel heretofore described . . . his United States Constitutional rights were violated. The Sixth Amendment guarantees the right to effective assistance of counsel in criminal prosecutions,” citing Strickland. The PCR court considered Vandross’s claim on the merits, reciting each expert requested and the reasons why that expert was claimed to be relevant. But it also noted that “none of these ‘experts’ were present to testify on his behalf at the PCR hearing” to “show any resulting prejudice.” In denying relief, the PCR court applied federal law, noting that it required Vandross to show (1) that his “counsel’s performance was deficient,” 11 and (2) that his “counsel’s deficient performance . . . prejudiced Applicant such that ‘there is a reasonable probability that, but for counsel’s unprofessional errors, the result of the proceeding would have been different,’” quoting Cherry v. State, 386 S.E. 2d 624 , 625 (S.C. 1989) (quoting Strickland, 466 U.S. at 694 ). In concluding that Vandross failed to meet his burden, the court held, among other things, that Vandross failed to prove the prejudice prong of Strickland, stating: Prejudice from trial counsel’s failure to call witnesses cannot be shown where the witnesses do not testify at post-conviction relief. Underwood v. State, 309 S.C. 560 , 425 S.E.2d 20 (1992); Bassett v. Thompson, 915 F.2d 932 (4th Cir. 1990), cert. denied, 499 U.S. 982 (1991). An Applicant must produce the testimony of a favorable witness or otherwise offer the testimony in accordance with the rules of evidence at the PCR hearing in order to establish prejudice from the witness’ failure to testify at trial. Bannister v. State, 333 S.C. 298 , 509 S.E.2d 807 (1998). Applicant produced no such testimony of any expert witnesses at the PCR hearing, and therefore cannot show any resulting prejudice. In short, the state PCR court decided on the merits the very same claim that Vandross set forth in his § 2254 application. While § 2254 authorizes federal courts to “entertain” an application for a writ of habeas corpus from a person in state custody “in violation of the Constitution or laws or treaties of the United States,” 28 U.S.C. § 2254 (a), it provides nonetheless that such a habeas writ may not be granted “with respect to any claim that was adjudicated on the merits in state court proceedings,” subject to three exceptions: (1) a showing that the state court decision “was contrary to” federal law; (2) a showing that the state court decision “involved an unreasonable application of” federal law; or (3) the state court decision “was based on an unreasonable determination of the facts” in light of the record before the state 12 court, id. § 2254(d) (emphasis added); Harrington v. Richter, 562 U.S. 86 , 100 (2011). Therefore, because the state PCR court adjudicated Vandross’s ineffective-assistance claim on the merits, Vandross must, to obtain federal review of that claim, show one of the three exceptions to the § 2254(d) bar — specifically, as applicable here, that the state PCR decision “involved an unreasonable application of” federal law. This he has not attempted to do, nor could he. The state PCR court correctly recited the requirements of Strickland and correctly applied those requirements to the facts in the record. In doing so, it also concluded correctly that no evidence was presented or offered to show prejudice in that any of the forensic evidence presented by the State at trial was flawed. While Vandross did point out various gaps in the State’s evidence, he highlighted those gaps to the jury. Moreover, he did not offer or present any evidence to the state PCR court that would have filled the gaps such that it would show a reasonable probability of a change in the result. Simply, Vandross has not shown that the PCR court’s decision was an unreasonable application of Strickland as is necessary to show an exception to the § 2254(d) bar to review a state PCR decision resolving a claim on the merits. III Rather than attempting to demonstrate that the PCR court’s decision was an unreasonable application of federal law, Vandross argues that his failure to show prejudice at the state PCR hearing was the result of the ineffective assistance of counsel at that hearing. Like his trial counsel, his state PCR counsel failed to present any expert testimony, 13 this time as needed to show prejudice from his trial counsel’s failure to do so. Because of that deficiency, Vandross argues, he should be excused from demonstrating that the PCR court unreasonably applied federal law, and he requests instead that the federal court perform collateral review of the issue. In making his argument, he recognizes the general rule that because he was not constitutionally entitled to counsel during his state post- conviction proceedings, he “cannot claim constitutionally ineffective assistance of counsel in such proceedings.” Coleman v. Thompson, 501 U.S. 722 , 752 (1991). He instead seeks to justify federal review by calling his counsel’s deficiency in the state PCR proceeding a procedural default that justifies application of the narrow exception provided by Martinez v. Ryan, 566 U.S. 1 (2012). In Martinez, the Court held that a federal court may review a procedurally defaulted ineffective-assistance claim when (1) the state PCR court is the first occasion for raising the claim, (2) the petitioner’s counsel provided ineffective assistance in the PCR court, and (3) it is likely that no state court will hear the prisoner’s claim. Id. at 18 . To support federal review justified by the Martinez exception, Vandross requested funding from the district court to retain an expert for the federal proceeding — a request the court granted — and then presented the affidavit of Dr. Morrison to show prejudice resulting from his trial counsel’s deficiency. The district court considered the affidavit over the objection of the State in resolving Vandross’s § 2254 application. Vandross’s argument to excuse his failure to show prejudice at the state PCR hearing raises two issues. Can Vandross supplement the state court record in the federal court on the ground that his state PCR counsel was deficient, relying on Martinez? And 14 does the record, even when so supplemented, sufficiently support a showing of prejudice? We address these in order. A As a general rule, our review under § 2254(d) “is limited to the record that was before the state court that adjudicated the claim on the merits.” Cullen v. Pinholster, 563 U.S. 170 , 181 (2011); see also Moore v. Stirling, 952 F.3d 174 , 181 (4th Cir. 2020). This rule flows directly from the text of § 2254, which “focuses on what a state court knew and did.” Pinholster, 563 U.S. at 182 . Vandross nonetheless insists that Dr. Morrison’s affidavit may be considered because his failure to present evidence of prejudice at his state PCR hearing was itself the product of the ineffective assistance of his state PCR counsel. In making this argument, he seeks to apply cases involving the doctrine of procedural default, analogizing his PCR counsel’s failure to a default. Normally, if an applicant does not present a claim to a state court and that court does not have an opportunity to consider it, review by a federal court is barred because the claim is procedurally defaulted. See Coleman, 501 U.S. at 731–32. But, as Vandross correctly argues, the Supreme Court has recognized a “narrow exception” to that rule in Martinez, 566 U.S. at 9 . As the Martinez Court stated, a federal court may review a “substantial” ineffective assistance of counsel claim, notwithstanding procedural default, when state law required that the claim be raised in the state “initial-review collateral proceeding” and, in that initial proceeding, “there was no counsel or counsel in 15 that proceeding was ineffective.” 566 U.S. at 17 ; see also Trevino v. Thaler, 569 U.S. 413 , 423 (2013) (identifying the four elements necessary to apply the Martinez exception). In effect, Vandross requests that we carry the Martinez exception to procedural default over to this case to provide an exception to the distinct rule that our review under § 2254 “is limited to the record that was before the state court.” Pinholster, 563 U.S. at 181 . This request, however, is foreclosed. We have already held on more than one occasion that Martinez, which authorizes a federal court to consider a new claim that was procedurally defaulted, does not provide a similar exception for new evidence supporting a claim that was in fact presented in state court. See, e.g., Gray v. Zook, 806 F.3d 783 , 789 (4th Cir. 2015) (“[I]f claims are not procedurally defaulted — that is, they were properly presented to the state court — then Martinez does not apply”). Other courts of appeals have uniformly reached the same conclusion. See, e.g., Escamilla v. Stephens, 749 F.3d 380 , 395 (5th Cir. 2014) (“[O]nce a claim is considered and denied on the merits by the state habeas court, Martinez is inapplicable, and may not function as an exception to Pinholster’s rule that bars a federal habeas court from considering evidence not presented to the state habeas court”); Moore v. Mitchell, 708 F.3d 760 , 785 (6th Cir. 2013) (“[Applicant] is not asking that we afford a Martinez-like review of a procedurally defaulted claim, but rather that we turn Martinez into a route to circumvent Pinholster”); Floyd v. Filson, 949 F.3d 1128 , 1147–48 (9th Cir. 2020) (same). In Gray, we held that, just like here, a federal court deciding a § 2254 claim may not consider an expert affidavit submitted to the district court after the applicant failed 16 previously to submit such evidence to the state court in order to prove that trial counsel’s failure to call expert witnesses prejudiced the applicant’s trial. Gray, 806 F.3d at 798–99. That rule, though, applies only when the federal habeas claim is “fundamentally the same” as the claim presented to the state court. Moore, 952 F.3d at 182. By contrast, in limited circumstances, “new evidence [can] ‘fundamentally alter’ the ‘substance’ of the claim so as to make the claim a new one” that was not presented to the state court. Id. at 182–83 (cleaned up) (quoting Vasquez v. Hillery, 474 U.S. 254 , 260 (1986)). But that does not occur where the new evidence does not “change the heart of the claim” but instead “merely strengthens the evidence presented in the state PCR hearing.” Id. at 184; see also Gray, 806 F.3d at 799 (recognizing “that a petitioner may not support a claim in state court with mere conjecture and subsequently provide the necessary evidentiary support for the claim on federal habeas review”). In this case, Vandross did not procedurally default his ineffective-assistance claim before the state PCR court. Rather, he attempted to present it fully, arguing both his counsel’s deficiency and resulting prejudice. He simply sought, in the federal court, to supplement the evidence in support of that claim in order to better show prejudice. Thus, while Dr. Morrison’s affidavit might have strengthened Vandross’s ineffective-assistance claim, it did not “fundamentally alter” it. Gray, 806 F.3d at 799. Accordingly, our review is limited to the state PCR court’s record, and the district court’s consideration of Dr. Morrison’s affidavit was error. On that record, Vandross’s § 2254 application must be denied, as shown above. Nonetheless, the district court’s 17 conclusions about the substance of Dr. Morrison’s affidavit were completely valid, and we affirm on that basis also. B Vandross relies almost exclusively on Dr. Morrison’s affidavit to establish in federal court that his trial counsel’s deficient performance resulted in prejudice. He argues that it shows that his trial counsel never subjected Wilson’s account “to scientific scrutiny” and that there is a reasonable probability that doing so would have resulted in a different outcome. In his affidavit, Dr. Morrison states that “either I, or another forensic investigator, could have assisted trial counsel in challenging the forensic evidence in this case. In my opinion, law enforcement did not undertake a very thorough investigation, and I (or another forensic investigator) could have assisted trial counsel in bring[ing] this to the jury’s attention.” (Emphasis added). He then lists 14 distinct issues that could have been challenged at trial or could have been investigated further. He concludes, “Had trial counsel or PCR retained counsel [retained me or another forensic investigator] for purposes of challenging the forensic science testimony and the lack of physical evidence in this case, I believe it would have undermined the integrity of the State’s case against Mr. Vandross.” Remarkably, Dr. Morrison did not himself test, or have some other expert test, any of the relevant evidence. He did not even use his expertise to speculate as to what such testing would have found. Instead, he simply put forth a menu of options that a forensic expert could have explored in greater depth. Yet, from the substance of Dr. Morrison’s 18 affidavit, Vandross reasons that if an expert had so explored the list of options, the expert would have uncovered some form of evidence that may well have altered the jury’s verdict. But he has pointed to nothing specific. More is required. When a petitioner’s ineffective assistance of counsel claim rests on trial counsel’s failure to call particular witnesses, expert or otherwise, we require “a specific proffer . . . as to what an expert witness would have testified.” Goins v. Warden, Perry Corr. Inst., 576 F. App’x 167, 173 (4th Cir. 2014) (per curiam). A petitioner’s failure to do so “reduces any claim of prejudice to mere speculation and is fatal to his claim.” Id. (emphasis added); see also Bassette v. Thompson, 915 F.2d 932 , 940 (4th Cir. 1990) (“The great failing of the appellant on his claim that other evidence should have been presented during the sentencing phase of his trial is the absence of a proffer of testimony from a witness or witnesses he claims his attorney should have called”); Beaver v. Thompson, 93 F.3d 1186 , 1195 (4th Cir. 1996) (“[A]n allegation of inadequate investigation does not warrant habeas relief absent a proffer of what favorable evidence or testimony would have been produced”). The South Carolina courts require the same. See Bannister v. State, 509 S.E.2d 807 , 809 (S.C. 1998) (“This Court has repeatedly held a PCR applicant must produce the testimony of a favorable witness or otherwise offer the testimony in accordance with the rules of evidence at the PCR hearing in order to establish prejudice from the witness’ failure to testify at trial”); Porter v. State, 629 S.E.2d 353 , 358 (S.C. 2006), abrogated on other grounds by Smalls v. State, 810 S.E.2d 836 (S.C. 2018) (“Mere speculation of what a witness’ testimony may be is insufficient to satisfy the burden of showing prejudice in a 19 petition for PCR”); Clark v. State, 434 S.E.2d 266 , 267 (S.C. 1993) (“[P]ure conjecture” about how an expert witness would testify is not sufficient “to establish the result would probably change if a new trial is had”). Without proffering any evidence of what an expert would have concluded, Dr. Morrison’s affidavit suffers from what these cases describe as mere speculation. The affidavit identifies only where a forensic expert could have looked for exculpatory evidence, but it failed to present that exculpatory evidence — or even proof that it exists — to establish prejudice. In short, Dr. Morrison’s affidavit, even if properly considered, would not have helped Vandross’s claim, as the district court concluded. * * * We conclude that Vandross has failed to establish that the state PCR court’s decision involved an unreasonable application of federal law when it concluded that Vandross failed to prove the requisite prejudice for his ineffective assistance of counsel claim and therefore that the district court did not err in denying his § 2254 application. AFFIRMED 20

2020-12-01 23:01:04.5335+00

https://www2.ca3.uscourts.gov/opinarch/182888p.pdf

PRECEDENTIAL UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT _____________ No. 18-2888 _____________ UNITED STATES OF AMERICA v. MALIK NASIR, Appellant _______________ On Appeal from the United States District Court for the District of Delaware (D.C. No. 1-16-cr-00015-001) District Judge: Hon. Leonard P. Stark _______________ Argued on November 12, 2019 before Merits Panel Argued En Banc on June 24, 2020  Before: SMITH, Chief Judge, McKEE, AMBRO, CHAGARES, JORDAN, HARDIMAN, GREENAWAY, JR., SHWARTZ, KRAUSE, RESTREPO, BIBAS, PORTER, MATEY, PHIPPS, SCIRICA,* and RENDELL,* Circuit Judges. (Filed: December 1, 2020) _______________ Leigh M. Skipper Brett G. Sweitzer Keith M. Donoghue [ARGUED] Federal Community Defender Office For the Eastern District of Pennsylvania 601 Walnut Street The Curtis Center – Suite 540 West Philadelphia, PA 19106 Counsel for Appellant Ilya Shapiro Cato Institute 1000 Massachusetts Avenue, NW Washington, DC 20001 Counsel for Amicus Cato Institute * Judges Scirica and Rendell have elected to participate as a member of the en banc court pursuant to Third Cir. I.O.P. 9.6.4. 2 Jared McClain New Civil Liberties Alliance 1225 19th Street, NW – Suite 450 Washington, DC 20036 Counsel for Amicus New Civil Liberties Alliance Evan A. Young Baker Botts 98 San Jacinto Boulevard – Suite 1500 Austin, TX 78701 Counsel for National Association of Home Builders, American Farm Bureau Federation, National Cattlemens Beef Association, and National Mining Association David C. Weiss Robert F. Kravetz [ARGUED] Whitney C. Cloud [ARGUED] Daniel E. Logan, Jr. Office of United States Attorney 1313 North Market Street Hercules Bldg. – Ste. 400 Wilmington, DE 19801 Counsel for Appellee _______________ OPINION OF THE COURT** ** The opinions of Judges McKee, Ambro, Jordan, Greenaway, Jr., Krause, Restrepo, Matey, Scirica, and Rendell are reflected in this Majority Opinion in Sections I, II.D., and II.E., as well as in the Conclusion in Section III of the Opinion, 3  _______________ JORDAN, Circuit Judge. On a tip, Malik Nasir was arrested near a storage unit in which he kept the marijuana he was selling. He was subsequently charged with, and convicted of, two drug offenses and a firearm offense. At sentencing, the District Court applied a career offender enhancement. Nasir now appeals his convictions and challenges the application of that enhancement. We will affirm Nasir’s convictions in part but, in light of the Supreme Court’s decision in Rehaif v. United States, 139 S. Ct. 2191 (2019), we will vacate his conviction as a felon in possession of a firearm and remand for a new trial on that charge, as well as for resentencing on the remaining counts of conviction. to the extent the Conclusion addresses subjects considered in Sections II.D and II.E. Judge Bibas has written a concurring opinion as to Section II.D., and Judge Matey has written a concurring opinion as to Section II.E. The opinions of Chief Judge Smith and Judges Chagares, Hardiman, Shwartz, Bibas, Porter, and Phipps are reflected in the Partial Dissent authored by Judge Porter and in Sections I and II.D. of the Majority Opinion, and in the Conclusion in Section III, to the extent the Conclusion addresses the subject considered in Section II.D. The remaining portions of the Majority Opinion represent the precedential decision of the original panel in this case, consisting of Judges Jordan, Scirica, and Rendell. 4 I. BACKGROUND On December 21, 2015, the owner of a storage facility in Dover, Delaware reported to the police suspicious activity at one of the storage units, number C69. The owner asked the police to visit the storage facility to discuss what he believed to be “drug occurrences” on his property. (App. at 90.) When the police arrived, he told them that, over the past several months, someone had visited that unit frequently, as often as five times a day. Each time, the man – whom he identified as Nasir – would enter the storage unit and close the door behind him. Shortly thereafter, he would reemerge and leave the facility. Concerned about illegal activity, the owner had taken a photograph of the inside of the unit, which he showed the officers. It revealed two large coolers, two closed buckets, a box of baggies, a large bag, and an aerosol spray can. The owner provided a copy of a rental agreement signed by Nasir and a photocopy of Nasir’s driver’s license. The rental agreement listed Nasir’s storage unit as C43, not C69, but the police apparently did not notice that discrepancy.1 Following up on the information provided by the facility owner, the police ran a criminal history check on Nasir and learned that he had a criminal record that included felony drug convictions. They visited unit C69 with a drug detection dog, and the dog positively alerted to the presence of drugs there. Based on the accumulated evidence, the detectives applied for a search warrant for that unit. 1 Nasir had initially agreed to rent unit C43, but soon after transferred to unit C69. 5  While awaiting the warrant, several police officers remained at the storage unit, and one surveilled Nasir’s home. The officer at the home saw Nasir place a large black bag in the back of a Mercury Mariner SUV and drive in the direction of the storage facility. Nasir in fact went to the facility, and, when he arrived, the officers stopped him as he entered the row of units including numbers C69 and C43. After handcuffing him and putting him in the back of a patrol car, they searched his SUV, where they found a black duffle bag and a key to unit C69. That same night, a search warrant issued and was executed. In unit C69, the police found more than three kilograms of marijuana, as well as scales and packaging materials. The next day, they applied for and received a search warrant for Nasir’s home and any vehicles on the property. While executing the warrant, the officers found $5,000 in cash in a grocery bag in the house and several handguns with ammunition in a Dodge Charger parked on the property. Nasir was indicted for violating 21 U.S.C. § 856 (a)(1), part of what is commonly known as the crack house statute (Count One), and was also charged under 21 U.S.C. §§ 841 (a)(1) and (b)(1)(D) for possession of marijuana with intent to distribute (Count Two), and under 18 U.S.C. §§ 922 (g)(1) and 924(a)(2) as a felon in possession of a firearm (Count Three). He moved to suppress the evidence obtained from the searches of the storage unit, his house, and his vehicles. The District Court held hearings on that motion and denied it. At trial, and of particular relevance now, Nasir entered a stipulation with the government as to the charge that he 6 illegally possessed a firearm. Pursuant to Old Chief v. United States, 519 U.S. 172 (1997),2 he stipulated that, prior to the date when he allegedly possessed the firearm, he had been “convicted of a felony crime punishable by imprisonment for a term exceeding one year, in the United States District Court for the Eastern District of Virginia.”3 (Supp. App. at 21.) The jury convicted him on all three counts of the indictment. 2 Old Chief held that defendants in prosecutions under 18 U.S.C. § 922 (g)(1) are entitled to enter a stipulation establishing their status as felons (and thus as persons prohibited from possessing firearms), in which case the government cannot introduce evidence establishing what the prior offense was. “The most the jury needs to know is that the conviction admitted by the defendant falls within the class of crimes that Congress thought should bar a convict from possessing a gun, and this point may be made readily in a defendant’s admission … .” 519 U.S. at 174 , 190–91. 3 In its entirety, the stipulation stated: The United States of America, by and through its undersigned attorneys, and James Brose, attorney for Defendant Nasir, hereby stipulate and agree to the following: Prior to December 21, 2015, the date alleged in Count Three of the Indictment, Defendant Malik Nasir was convicted of a felony crime punishable by imprisonment for a term exceeding one year, in the United States District Court for the Eastern District of Virginia. 7  After the trial, Nasir filed a motion to set aside the verdict and a motion for a new trial, both of which were denied. The District Court sentenced him to 210 months of imprisonment and three years of supervised release, having determined that he qualified as a career offender under the United States Sentencing Guidelines (the “guidelines”) because of two earlier convictions in Virginia, one from the year 2000 for attempting to possess cocaine with intent to distribute and one from 2001 for possession of cocaine and marijuana. This timely appeal followed. II. DISCUSSION4 Nasir raises five arguments. First, he says that there was insufficient evidence to sustain his conviction under the crack house statute because the section of the statute under which he was convicted does not make it unlawful to store drugs. Second, he argues that the officer who searched the Mercury Mariner did not have probable cause to justify that search, so the evidence found there should have been suppressed. Third, he contends that a member of his jury was avowedly partial, so seating her deprived him of a fair trial. Fourth, he asserts that the career offender enhancement under the guidelines should not have factored into his sentencing because one of his prior felony convictions does not qualify as a “controlled substance offense,” as that term is defined in the guidelines. Finally, he (Supp. App. at 21.) 4 The District Court had jurisdiction under 18 U.S.C. § 3231 . We have jurisdiction under 28 U.S.C. § 1291 and 18 U.S.C. § 3742 . 8 argues that the government did not prove that he knew he was a felon, as is now required by Rehaif in a prosecution under 18 U.S.C. § 922 (g), 139 S. Ct. at 2194 , so his conviction under that statute for being a felon in possession of a firearm cannot stand. We will affirm the District Court’s denial of Nasir’s motion for acquittal as to Counts 1 and 2 and accordingly affirm those convictions. In doing so, we reject Nasir’s first three arguments. However, we agree that he does not qualify for the career offender enhancement and must be resentenced. We also hold that his conviction for being a felon in possession of a firearm must be vacated and remanded for a new trial on that count of the indictment. A. The Crack House Conviction Nasir first challenges his conviction under the crack house statute, specifically 21 U.S.C. § 856 (a)(1), which makes it unlawful to “knowingly … lease, rent, use, or maintain any place … for the purpose of manufacturing, distributing, or using any controlled substance.” Despite the breadth of that language, Nasir argues that his conviction should be reversed because, he says, that subsection was not meant to cover storage.5 Nasir did not preserve that argument in the District 5 Nasir does not argue that 21 U.S.C. § 856 (a)(1) does not cover storage units; instead, he says that it does not cover the activity of storing. The distinction he attempts to draw is irrelevant here because, as we will explain, there was ample evidence to support the finding that Nasir was not merely storing drugs, he was distributing drugs from a rented place. 9 Court, so we review the denial of his motion for judgment of acquittal for plain error.6 United States v. Olano, 507 U.S. 725 , 731 (1993). We will reverse for plain error only if there was an actual error that is plain, that affects “the outcome of the district court proceedings,” and that “seriously affect[s] the fairness, integrity or public reputation of judicial proceedings.” Id. at 734-36 (citations and internal quotation marks omitted) (alteration in original). Nasir’s argument rests on the contrast between subsection (a)(1) of the crack house statute, which he was convicted of violating, and subsection (a)(2), under which he was not charged. That latter subsection declares it unlawful to “manage or control any place, whether permanently or temporarily, … and knowingly and intentionally rent, lease, profit from, or make available for use, with or without compensation, the place for the purpose of unlawfully manufacturing, storing, distributing, or using a controlled substance.” 21 U.S.C. § 856 (a)(2) (emphasis added). According to Nasir, because “storing” is listed as a prohibited activity in subsection (a)(2) but is not mentioned in subsection (a)(1), it was intentionally excluded from (a)(1). By 6 Nasir claims he preserved his position when he raised a sufficiency-of-the-evidence challenge. At trial, Nasir’s attorney said, “[s]uccinctly, it’s our position that the government has not proved Mr. Nasir in possession of either the firearms or the marijuana.” (App. at 549.) But counsel’s generic statement, which made no reference to 21 U.S.C. § 856 , was not sufficient to preserve a claim of error on this issue. 10 his lights, since he was storing illegal drugs, he should be safe from conviction under (a)(1). But even if we were inclined to accept that subsection (a)(1) does not cover storage, that does not help Nasir. No sensible reading of the statute allows one to distribute drugs just because one is also storing them. Within unit C69, besides the drugs themselves, there was drug distribution paraphernalia, namely scales and packaging materials such as food storage bags. In addition to that evidence, there was the testimony of the facility owner about Nasir’s frequent and suspicious trips to the unit. Subsection (a)(1) expressly prohibits “distributing” a controlled substance from any rented place, and the jury was presented with more than ample evidence that Nasir was doing just that. The District Court properly instructed the jury that it could find Nasir guilty of violating section 856(a)(1) if he used a “place for the purpose of manufacturing, distributing, or using any controlled substance.” (App. at 615 (emphasis added).) There was thus an obvious and legitimate basis for his conviction under the crack house statute, and the District Court’s denial of Nasir’s motion for a judgment of acquittal was not error at all, let alone plain error. B. The Motion to Suppress Evidence from the SUV Nasir also appeals the denial of his motion to suppress the evidence retrieved in the search of his Mercury Mariner SUV. He repeats the argument he made in the District Court, saying that the officer who searched the SUV lacked probable cause. We review de novo whether there was probable cause to justify police action. United States v. Vasquez-Algarin, 821 F.3d 467 , 471 (3d Cir. 2016). 11  The legal theories offered in opposition to and support of the SUV search have morphed over time. They began with Nasir objecting to the search as the proverbial fruit of the poisonous tree. He said the “[p]olice did not have cause to arrest [him] at the time he arrived at the storage facility parking lot and accordingly all statements made by him and any evidence found subsequent to his arrest should be suppressed.” (App. at 47.) In responding to that motion, the government said that the search of the SUV “was a lawful search incident to a valid arrest pursuant to Arizona v. Gant, 556 U.S. 332 (2009).” (App. at 60 n.21.) The government also stated that, at the suppression hearing, it “would present evidence that the search … was a valid inventory search[,]” although apparently it did not do so. (App. at 60 n.21.) In his post-hearing rebuttal briefing before the District Court, Nasir argued that the search of the SUV was unlawful as a search incident to arrest and as an inventory search. The District Court ultimately classified the search as being incident to Nasir’s arrest but noted that, even if the search had occurred prior to the arrest, “the search of the vehicle appears to have been within the scope of the automobile exception” to the warrant requirement of the Fourth Amendment. (App. at 21 n.4 (citations omitted).) On appeal, Nasir simply asserts that there was no probable cause to search the SUV, without specifying the legal framework for analysis.7 We conclude that the District Court 7 Although Nasir pointed out in his briefing that the arresting officer said he “[b]asically … looked at [the search] as an inventory search,” (App. at 138,) that does not appear to have been the theory that the government pursued before the District Court or now pursues on appeal. 12 correctly approached the issue as being a search incident to arrest. Even when, like Nasir, an arrestee is detained and not within reach of his vehicle, the police may conduct “a search incident to a lawful arrest when it is reasonable to believe evidence relevant to the crime of arrest might be found in the vehicle.” Gant, 556 U.S. at 343 (citation and internal quotation marks omitted). Whether viewed as a question of probable cause to arrest Nasir or probable cause to search the SUV under the automobile exception, however, the pertinent facts and the outcome are the same. In challenging the search of the SUV, Nasir says that the evidence uncovered in that vehicle – a black duffle bag and the key to unit C69 – should have been suppressed because the investigating officers did not corroborate the tip from the storage facility owner. Nasir characterizes the owner as an unknown and unreliable informant, and he lays particular emphasis on the incorrect unit number on the rental agreement the owner provided to the police. Nasir also argues that the District Court impermissibly attributed information known only to officers not present at the search to the officer who actually conducted the search. His arguments are unpersuasive. When the police receive information from an informant for the first time, they have a duty to independently corroborate at least some of the information the informant provides. See Illinois v. Gates, 462 U.S. 213 , 242 (1983) (“[A]n officer may rely upon information received through an informant, rather than upon his direct observations, so long as the informant’s statement is reasonably corroborated by other matters within the officer’s knowledge.” (citation and internal quotation marks omitted)). They discharged that duty in this case. The 13 arresting officers personally knew the following at the time of the arrest and related search of the vehicle: according to a background check, Nasir had a history of drug dealing; the owner of the storage facility had reported Nasir engaged in suspicious activity at unit C69, including making numerous trips to the storage unit, sometimes several in a day; the owner had taken a photograph that showed items in the unit consistent with drug distribution; an officer had seen Nasir put a bag in the back of his car and drive toward the storage facility; and a narcotics dog had positively alerted to drugs at unit C69. Given the totality of those circumstances known to the officers who arrested Nasir, there was certainly probable cause, reasonably corroborated, for Nasir’s arrest, and it was reasonable to believe that evidence of his drug dealing would be found in the SUV.8 We will therefore affirm the District Court’s denial of Nasir’s motion to suppress. C. The Ruling on Alleged Juror Bias 8 We note, as did the District Court, that even if the search had been performed prior to Nasir’s arrest, “the search of the vehicle appears to have been within the scope of the automobile exception.” (App. at 21 n.4 (citations omitted).) It is well established that under the automobile exception to the warrant requirement, the police may search a vehicle if they have probable cause to believe that the vehicle contains evidence of criminal activity. Carroll v. United States, 267 U.S. 132 , 155-56 (1925). Here, the same facts that gave rise to probable cause for an arrest can rightly be seen as independently giving rise to probable cause for a search of the vehicle. 14  Nasir next claims that he was deprived of a fair and impartial jury because one of the jurors at his trial, Juror 27, did not unequivocally affirm that she would be impartial. Our review of a ruling on a motion to strike a juror for cause is for manifest error – a most deferential standard. Skilling v. United States, 561 U.S. 358 , 396 (2010). The Supreme Court has emphasized that jury selection is “particularly within the province of the trial judge” and cautioned against “second- guessing the trial judge’s estimation of a juror’s impartiality[.]” Id. at 386 (citation and internal quotation marks omitted). During voir dire, one of the questions the District Court asked to determine juror partiality was, “Would you give more or less weight to the testimony of a law enforcement agent or police officer than you would give to that of a civilian witness, simply because he or she is employed as a law enforcement agent or police officer?” (App. at 237-38.) Because Juror 27 answered “yes” to that question, the following colloquy ensued: A JUROR: […] But the other thing that I kind of answered “yes” to was police officer and a person on the street. I would like to think I would be partial (sic), but I don’t know. THE COURT: You would like to think you would be impartial and fair to both sides? A JUROR: Yes, impartial that is what I would like to say. THE COURT: What is your concern you wouldn’t be? A JUROR: Well, my daughter dates a state police officer. And I really have a lot of respect 15  for them, you know, and I feel that for the most part they all do a good job, and they try to be fair. I think I might tend to believe what they say. I don’t know. THE COURT: Do you think if I instruct you that you have to be fair and impartial and assess everybody’s credibility as best as you can that you would be able to do that? A JUROR: I would think I would. I would hope I would. (App. at 305.) Then, outside the juror’s presence the Court and counsel had this further conversation: [NASIR’S ATTORNEY]: Your Honor, I move to strike on the basis that she -- her daughter is dating a state police officer and she would tend to believe the officer and police testimony. THE COURT: What is the government’s position? [GOVERNMENT’S ATTORNEY]: Your Honor, I don’t have a real strong one. That she would answer any questions that she was instructed [sic]. She could stay impartial. She confronted all those issues. I certainly understand why [Defense counsel] is objecting. THE COURT: Any response? [NASIR’S ATTORNEY]: No response, Your Honor. THE COURT: I’m going to deny the motion. I felt sufficient confidence that she would work as hard as anyone could to be fair and impartial, and 16  I think she would follow the instructions. So I’m denying the motion to strike. (App. at 306-07). Nasir argues that the statements “I would think I would” and “I would hope I would” are not sufficiently strong affirmations of impartiality. Because the juror admitted to her concern about partiality, the District Court quite rightly asked follow-up questions to determine whether she was actually biased. Cf. United States v. Mitchell, 690 F.3d 137 , 142 (3d Cir. 2012) (holding that actual bias is “the existence of a state of mind that leads to an inference that the person will not act with entire impartiality[,]” unlike implied bias, which is “presumed as [a] matter of law” (citations and internal quotation marks omitted)). Here, Juror 27’s acknowledgement that she “ha[s] a lot of respect for” police officers and “might tend to believe what they say” prompted the District Court to emphasize her obligation to be fair and impartial and to weigh the evidence equally. (App. at 305.) She responded with assurances that she would follow the Court’s instructions. Her declaration that she “would think” and “would hope” (App. at 305) that she could be impartial – combined, it seems, with the way in which she said it – allowed the District Court, observing her behavior and mannerisms first hand, to have “sufficient confidence that she would work as hard as anyone could to be fair and impartial.” (App. at 306-07.) That decision, on this record, is not manifestly erroneous. D. The Career Offender Enhancement Nasir next challenges the enhancement he received at sentencing pursuant to the “career offender” provision of the sentencing guidelines. He argues that he should not have 17 received the enhancement because one of his two prior qualifying convictions was an inchoate drug offense, which does not qualify as a predicate offense under the plain language of the guidelines. The interpretation of the guidelines is a legal question, so we exercise plenary review. United States v. Wilson, 880 F.3d 80 , 83 (3d Cir. 2018). We agree with Nasir that the plain language of the guidelines does not include inchoate crimes, so he must be resentenced. 1. The Definition of “Controlled Substance Offenses” in the Guidelines Under section 4B1.1 of the sentencing guidelines, an adult defendant is a career offender if “the instant offense of conviction is a felony that is either a crime of violence or a controlled substance offense; and … the defendant has at least two prior felony convictions of either a crime of violence or a controlled substance offense.” U.S.S.G. § 4B1.1(a). If a defendant is a career offender, that designation increases the offense level of the crime for which he is to be sentenced and mandates a criminal history ranking of Category VI. U.S.S.G. § 4B1.1(b). The District Court determined that one of Nasir’s three convictions in this case is a controlled substance offense, namely his conviction on Count Two for possession of marijuana with intent to distribute. After evaluating Nasir’s criminal history, the Court concluded that two of his prior convictions in Virginia state court also qualify as predicate controlled substance offenses: a 2000 conviction for an attempt to possess with intent to distribute cocaine and a 2001 conviction for possession of marijuana and cocaine with intent 18 to distribute.9 Nasir was accordingly sentenced as a career offender. He argues that his conviction in 2000 for attempting to possess with intent to distribute cocaine should not qualify as a “controlled substance offense” under section 4B1.1 because the guidelines’ definition of a “controlled substance offense” does not include inchoate crimes.10 In particular, Nasir points out that section 4B1.2 of the sentencing guidelines defines the term “controlled substance offense,” to mean an offense under federal or state law, punishable by imprisonment for a term exceeding one year, that prohibits the manufacture, import, export, distribution, or dispensing of a controlled substance (or a counterfeit substance) or the possession of a controlled substance (or a counterfeit substance) with intent to manufacture, import, export, distribute, or dispense. 9 Nasir has other prior convictions, but the government and Nasir appear to agree than none of them qualify as predicate offenses. 10 An inchoate offense is “[a] step toward the commission of another crime, the step itself being serious enough to merit punishment.” Offense, Black’s Law Dictionary (11th ed. 2019). Inchoate offenses include, for example, the attempt, conspiracy, or solicitation to commit a crime. Id. 19 U.S.S.G. § 4B1.2(b). Nasir notes this definition plainly does not mention inchoate crimes, and consequently asserts that his inchoate “attempt” crime should not qualify as a predicate offense for the career offender enhancement. The analytical problem is more complicated than that, however, because the commentary to section 4B1.2 appears to expand the definition of “‘controlled substance offense’ [to] include the offenses of aiding and abetting, conspiring, and attempting to commit such offenses.” U.S.S.G. § 4B1.2 cmt. n.1. That section of the commentary, and, importantly, our precedent on the application of the commentary to the interpretation of the guidelines, informed the District Court’s decision to apply the career offender enhancement. The question, then, is whether the more expansive commentary should be given controlling weight in interpreting the narrower guideline at issue here.11 2. The Effect of the Commentary on our Interpretation of the Guidelines 11 The Sentencing Commission has proposed an amendment to the guidelines to explicitly include inchoate offenses in section 4B1.2(b). Notice of Proposed Amendments, 83 Fed. Reg. 65400 -01, 65412-15 (Dec. 20, 2018). The proposed change has been submitted for notice and comment, and the time for notice and comment has closed. Id. However, the Commission does not currently have a quorum (and has not had one since at least 2018), so it cannot act on that issue. U.S. Sentencing Commission, 2018 Annual Report 2-3, available at https://www.ussc.gov/sites/default/files/pdf/research-and- publications/annual-reports-and-sourcebooks/2018/2018- Annual-Report.pdf. 20  The extent to which the guidelines’ commentary controls our interpretation of the guidelines themselves is informed by principles of administrative law. In Stinson v. United States, 508 U.S. 36 (1993), the Supreme Court considered how to classify the commentary to the sentencing guidelines and whether and when it should be given binding interpretive effect. Because the guidelines are written by the Sentencing Commission, a body that straddles both the legislative and judicial branches of the government, the Court determined that the commentary to the guidelines is more akin to an agency regulation than a statute. Id. at 44 . Consequently, the Court determined that the commentary should “be treated as an agency’s interpretation of its own legislative rule.” Id. Relying on its opinion in Bowles v. Seminole Rock & Sand Co., the Court said that such determinations should be given deference unless they are “plainly erroneous or inconsistent with the regulation.” Id. at 45 (quoting Bowles v. Seminole Rock & Sand Co., 325 U.S. 410 , 414 (1945)). Further, the Court instructed that, “if the guideline which the commentary interprets will bear the construction,” the commentary can expand the guidelines, particularly when the commentary is “interpretive and explanatory.” Id. at 46-47. Accordingly, so- called Seminole Rock deference, also sometimes called Auer deference,12 governs the effect to be given to the guidelines commentary. 12 In 1945, the Supreme Court upheld a regulation from the Office of Price Administration in Bowles v. Seminole Rock, after it determined that the language of the regulation was consistent with Administration’s interpretation of the regulation. Seminole Rock, 325 U.S. at 417 . Seminole Rock thus became shorthand for the doctrine of deference to an administrative agency’s interpretation of its own regulations. 21  Our precedent has followed that course. In United States v. Hightower, 25 F.3d 182 (3d Cir. 1994), we applied the principles set forth in Stinson to determine whether inchoate crimes are covered by sections 4B1.1 and 4B1.2 of the sentencing guidelines. We asked “whether the Sentencing Commission exceeded its statutory authority by expanding the definition of a controlled substance offense” when it included inchoate offenses as part of the definition of the term “controlled substance offense” in the commentary to section 4B1.2. Hightower, 25 F.3d at 184 (internal quotation marks omitted). We determined that the commentary to 4B1.2 was explanatory and therefore binding. Id. at 185-87 . Specifically, although we admitted that the inclusion of inchoate crimes was an “expansion of the definition of a controlled substance offense[,]” we said that the expansion was “not ‘inconsistent with, or a plainly erroneous reading of,’ § 4B1.2(2) of the [s]entencing [g]uidelines, and that it does not ‘violate[ ] the Constitution or a federal statute.’” Id. at 187 (second two alterations in original) (quoting Stinson, 508 U.S. at 38 ). We later followed that precedent in United States v. Glass, 904 F.3d 319 (3d Cir. 2018), in which we held that a conviction under a Pennsylvania “attempt” statute qualified as a predicate controlled substance offense for the career offender enhancement under the guidelines. More than fifty years later, in Auer v. Robbins, 519 U.S. 452 (1997), the Court reinforced that doctrine. The doctrine is thus sometimes referred to as Seminole Rock deference, after the case that introduced it, and at other times referred to as Auer deference, the more recent reiteration of the doctrine. 22  Our interpretation of the commentary at issue in Hightower – the same commentary before us now – was informed by the then-prevailing understanding of the deference that should be given to agency interpretations of their own regulations. Thus, although we recognized that the commentary expanded and did not merely interpret the definition of “controlled substance offense,” we nevertheless gave it binding effect. In doing so, we may have gone too far in affording deference to the guidelines’ commentary under the standard set forth in Stinson. Indeed, after the Supreme Court’s decision last year in Kisor v. Wilkie, 139 S. Ct. 2400 (2019), it is clear that such an interpretation is not warranted. In Kisor, the Court cut back on what had been understood to be uncritical and broad deference to agency interpretations of regulations and explained that Auer, or Seminole Rock, deference should only be applied when a regulation is genuinely ambiguous. Id. at 2414-15 . Kisor instructs that “a court must carefully consider the text, structure, history, and purpose of a regulation, in all the ways it would if it had no agency to fall back on. Doing so will resolve many seeming ambiguities out of the box, without resort to Auer deference.” Id. at 2415 (citation, brackets, and quotation marks omitted). Thus, before deciding that a regulation is “genuinely ambiguous, a court must exhaust all the traditional tools of construction.” Id. (citation and quotation marks omitted). Even when a regulation is ambiguous, there are limits to deference. The agency’s reading must be “reasonable[,]” as informed by “[t]he text, structure, history, and so forth[,]” which “establish the outer bounds of permissible interpretation.” Id. at 2415-16 . A court “must make an 23 independent inquiry into whether the character and context of the agency interpretation entitles it to controlling weight[,]” including whether it is the agency’s “official position[.]” Id. at 2416 . Moreover, an agency’s interpretation must “in some way implicate its substantive expertise” if it is to be given controlling weight, since “[s]ome interpretive issues may fall more naturally into a judge’s bailiwick.” Id. at 2417 . Finally, the reading must “reflect fair and considered judgment” and not simply be a “convenient litigating position.” Id. (citations and quotation marks omitted). In short, the degree of deference to be given an agency’s interpretation of its own regulations is now context dependent. 3. Plain Text and Policy The definition of “controlled substance offense” in section 4B1.2(b) of the guidelines is, again, in pertinent part as follows: [A]n offense under federal or state law, punishable by imprisonment for a term exceeding one year, that prohibits the manufacture, import, export, distribution, or dispensing of a controlled substance (or a counterfeit substance) or the possession of a controlled substance (or a counterfeit substance) with intent to manufacture, import, export, distribute, or dispense. U.S.S.G. § 4B1.2(b). The guideline does not even mention inchoate offenses. That alone indicates it does not include them. The plain-text reading of section 4B1.2(b) is strengthened when contrasted with the definition of “crime of 24 violence” in the previous subsection. That definition in section 4B1.2(a) does explicitly include inchoate crimes, see U.S.S.G. § 4B1.2(a) (“The term ‘crime of violence’ means any offense … that – (1) has as an element the use, attempted use, or threatened use of physical force against the person of another[.]” (emphasis added)), which further suggests that the omission of inchoate crimes from the very next subsection was intentional. That suggestion is separately bolstered by the fact that section 4B1.2(b) affirmatively lists many other offenses that do qualify as controlled substance offenses. As a familiar canon of construction states, expressio unius est exclusio alterius: the expression of one thing is the exclusion of the other. Applying that canon has led at least one court of appeals to conclude that section 4B1.2(b) does not include inchoate crimes. See United States v. Winstead, 890 F.3d 1082 , 1091 (D.C. Cir. 2018) (“Section 4B1.2(b) presents a very detailed ‘definition’ of controlled substance offense that clearly excludes inchoate offenses.”). There is an important additional policy advantage to the plain-text approach: it protects the separation of powers. If we accept that the commentary can do more than interpret the guidelines, that it can add to their scope, we allow circumvention of the checks Congress put on the Sentencing Commission, a body that exercises considerable authority in setting rules that can deprive citizens of their liberty. Unlike the guidelines, the commentary “never passes through the gauntlets of congressional review or notice and comment.” United States v. Havis, 927 F.3d 382 , 386 (6th Cir. 2019) (en banc) (per curiam); see also United States v. Swinton, 797 F. App’x 589, 602 (2d Cir. 2019) (quoting same and remanding 25 for resentencing with an instruction for the district court to “consider again whether, in light of the concerns addressed in Havis and Winstead, the career offender [g]uideline applies” to a defendant whose predicate offenses for the career offender enhancement include a conviction for attempted criminal sale of a controlled substance). On that basis, along with the plain text of the guidelines, another of our sister courts of appeals has rejected the notion that commentary to 4B1.2(b) can expand the guidelines’ scope. See Havis, 927 F.3d at 386. (Because it has not been approved by Congress, “commentary has no independent legal force—it serves only to interpret the [g]uidelines’ text, not to replace or modify it.”). We too agree that separation-of-powers concerns advise against any interpretation of the commentary that expands the substantive law set forth in the guidelines themselves. Cf. 28 U.S.C. § 995 (a)(20) (granting the Sentencing Commission power to “make recommendations to Congress concerning modification or enactment of statutes relating to sentencing[.]” (emphasis added)). In light of Kisor’s limitations on deference to administrative agencies, we conclude that inchoate crimes are not included in the definition of “controlled substance offenses” given in section 4B1.2(b) of the sentencing guidelines. Therefore, sitting en banc, we overrule Hightower, and accordingly, will vacate Nasir’s sentence and remand for resentencing without his being classified as a career offender. E. The Felon-in-Possession Conviction The final issue on appeal concerns Nasir’s conviction under 18 U.S.C. § 922 (g) for being a felon in possession of a 26 firearm. After Nasir filed his opening brief, the Supreme Court decided Rehaif v. United States, holding that, “in a prosecution under … § 922(g) …, the Government must prove both that the defendant knew he possessed a firearm and that he knew he belonged to the relevant category of persons barred from possessing a firearm.” 139 S. Ct. at 2200. The latter half of that holding – that the government must prove that the defendant knew of his status as a person prohibited from having a gun – announced a newly found element of the crime. For a defendant like Nasir, a previously convicted felon, that knowledge-of-status element means that the government has to prove that he knew he was a “person … who has been convicted … of … a crime punishable by imprisonment for a term exceeding one year.” 18 U.S.C. § 922 (g)(1). Proving that a felon knew he possessed a gun remains necessary but is no longer sufficient for a conviction. Proof of knowledge of status is now essential. Rehaif represents a reevaluation of an old and oft- invoked criminal statute. Nasir responded to the Supreme Court’s opinion by promptly filing a supplemental brief, arguing that his conviction as a felon in possession of a firearm cannot stand since the government did not provide any evidence to prove the knowledge-of-status element of the crime. He admits, though, that he did not voice an objection to that at trial. We therefore review for plain error. Again, the test for plain error under United States v. Olano proceeds in four steps and requires the defendant to prove that there was (1) an actual error (2) that is plain or obvious, (3) that affected “the outcome of the district court proceedings,” and (4) that “seriously affect[ed] the fairness, integrity or public reputation of judicial proceedings.” Olano, 27  507 U.S. at 734-36 (citations omitted). Even if the first three steps of the test are met, the fourth step grants us a degree of discretion in determining whether to correct the error. 13 Whether the alleged error is plain is evaluated based on the law at “the time of appellate review[,]” regardless of whether it was plain at the time of trial. Henderson v. United States, 568 U.S. 266 , 269 (2013). The government concedes that, in light of Rehaif’s applicability in this case, Nasir has satisfied the first two steps of Olano. The dispute here is whether the third and fourth steps are satisfied. Before directly addressing those steps, however, it bears repeating that, until Rehaif, § 922(g) had not been understood as the Supreme Court interpreted it there. No knowledge-of- status element had previously been perceived in the statute, and 13 Our dissenting colleagues say that, in addressing whether to correct the conceded plain error in this case, we have failed to appreciate the purpose of plain error review under Federal Rule of Criminal Procedure 52(b). (Dissent at 3-5.) In particular, the Dissent says that we “seem[] to suggest a presumption in favor of error-correction.” (Dissent at 5.) But we’ve said nothing of the sort. The import of our statement here should be clear: it is not enough to win on the first three prongs of Olano, because you can still lose at prong four. The implication is quite the opposite of what the Dissent attributes to us. The disagreement between our opinion and the Dissent hinges not on what Rule 52(b) means but, as we shall explain, on whether, given the type of error under consideration, we are free to look beyond the trial record when deciding if we should exercise our discretion under that rule. 28 no proof of it was required.14 It is hardly surprising, then, that the government did not offer any evidence at Nasir’s trial that 14 The Dissent implies that the knowledge-of-status element was somehow well known before Rehaif. But to say, as our dissenting colleagues do, that “the scienter issue was hardly a secret at the time of Nasir’s trial,” is to set up a straw man. (Dissent at 4.) It is true that scienter was understood to be a required point of proof in a § 922(g) prosecution, but the knowledge that had to be proven was the defendant’s knowledge that he possessed a firearm. While the Dissent has been able to identify a very few – three – dissenting opinions in appellate cases suggesting a knowledge-of-status element, such scienter was not a holding in any case, it appears, except for a single unreported district court case from many years ago. The small handful of judges who anticipated the Supreme Court’s turn by a dozen years deserve credit, but that hardly warrants the Dissent’s effort to paint the knowledge-of-status element as something that was current in conversation within the bench and bar. Far from it. As Justice Alito noted in his dissent in Rehaif, the Supreme Court majority in that watershed case “overturn[ed] the long-established interpretation of an important criminal statute, ... an interpretation that ha[d] been adopted by every single Court of Appeals to address the question” and an interpretation that “ha[d] been used in thousands of cases for more than 30 years.” 139 S. Ct. at 2201. So we think our emphasis on the unexpected and striking impact of Rehaif is fully justified. What is not justified is the Dissent’s suggestion that Nasir’s failure to object “deprived the government and trial court of … opportunities” to “supplement the record with additional evidence of Nasir’s mens rea.” (Dissent at 5.) Regardless of whether the knowledge-of-status element 29 he knew he was a felon, and the District Court did not instruct the jury that such proof was necessary. Since Rehaif, the government has claimed that the evidence admitted at the trial in this case was adequate to prove that, when Nasir was found with guns in his possession, he knew he was a felon and hence a person prohibited from possessing a firearm. But, perhaps recognizing how unconvincing that characterization of the evidence is, the government has spent the majority of its efforts in this appeal on a more plausible but still ultimately unsuccessful argument: that, even if the record is devoid of proof on the knowledge-of-status element, we should not recognize and correct the error on plain-error review because Nasir surely did know that he was a felon. That brings us to the difficult and dividing issue in this case, one that has elicited a variety of responses from other courts of appeals dealing with the aftermath of Rehaif. The was widely recognized before Rehaif, the government’s burden of proving that element, and every other element of the § 922(g) charge, was the same. Nothing that Nasir did or didn’t do at trial affected that. Failure to object at trial begets plain- error review on appeal; it does not reverse the constitutionally mandated burden of proof and does not put the government on moral high ground in our assessment of the consequences of plain error, as the Dissent seems to think. If the Dissent wants to think in terms of fault – an exercise that seems unproductive, especially in light of the marked change in the law wrought by Rehaif – then surely some fault must fall on the government for failing to recognize that knowledge-of-status is an element of the offense and therefore failing to introduce evidence about Nasir’s knowledge of his prior felony. 30 assertion that Nasir knew he was a felon is founded entirely on information that his jury never saw or heard, so the question is whether an appellate court on plain-error review is restricted to the trial record or is instead free to consider evidence that was not presented to the jury. We conclude that, even on plain- error review, basic constitutional principles require us to consider only what the government offered in evidence at the trial, not evidence it now wishes it had offered. Accordingly, we will vacate Nasir’s conviction for being a felon in possession of a firearm and will remand for a new trial on that charge.15 15 Nasir raises three Rehaif-based challenges to his conviction: that the indictment was defective for omitting knowledge-of-status as an element of the crime, that the jury was not properly instructed that knowledge-of-status is an element of the crime, and that the government did not present sufficient evidence of knowledge-of-status. While we are persuaded by Nasir’s last argument and recognize some merit in the second, we see no merit at all in the first. The language of the indictment echoes the language of the statute, stating that Nasir “did knowingly possess in and affecting interstate and foreign commerce, firearms … after having been convicted of a crime punishable by imprisonment for a term exceeding one year[.]” (App. at 40-41.) The indictment thus mirrors the language of the statute by listing the “knowingly” mens rea element first, allowing it to modify the other elements of the crime. See Hamling v. United States, 418 U.S. 87 , 117 (1974) (“It is generally sufficient that an indictment set forth the offense in the words of the statute itself, as long as ‘those words of themselves fully, directly, and expressly, without any uncertainty or ambiguity, set forth all the elements necessary to constitute the offence intended to be punished.’” (quoting 31  1. Due Process and the Right to Trial by Jury Limit our Review to the Trial Record As stated by the Supreme Court in In re Winship, “the Due Process Clause protects the accused against conviction except upon proof beyond a reasonable doubt of every fact necessary to constitute the crime with which he is charged.” 397 U.S. 358 , 364 (1970). The government has to prove its case to the “proper factfinder,” and “[d]ue process commands that no man shall lose his liberty unless the Government has borne the burden of … convincing the factfinder of his guilt.” Id. In the context of a jury trial such as Nasir’s, the requirements of due process are further bolstered by the Sixth Amendment, which allocates the role of “proper factfinder” to the jury, and to the jury alone. Indeed, going back at least as far as Blackstone, it has been a given that the jury – not appellate judges after the fact – must find “the truth of every accusation” for a conviction to be sustained.16 4 William United States v. Carll, 105 U.S. 611 , 612 (1882)). Because the language of the indictment is not uncertain or ambiguous, there was no error, much less plain error, in allowing prosecution of the § 922(g) count of the indictment. 16 On this point, we are in full agreement with the concurrence of our colleague Judge Matey, which eloquently emphasizes the right to trial by jury. Although our colleagues in dissent say that they “do not purport to ‘find facts’ in order to overcome a deficiency in the evidence and on that basis pronounce the defendant’s conviction while relieving the government of its burden” (Dissent at 9), that is precisely the effect of their position. If no facts were given to the jury from 32 Blackstone, Commentaries on the Laws of England, *343-44. The jury has “an unquestionable right” to decide the case, “for, if the judge’s opinion must rule the verdict, the trial by jury would be useless.” Id. at *354-55. Accordingly, to secure a conviction that is consistent with its constitutional obligations, the government must present evidence to the jury to prove beyond a reasonable doubt every single element of the crime. Notably, no one questions that if we were reviewing a sufficiency-of-the-evidence objection that had been preserved at trial, our review would be confined to the trial record. Only evidence and argument that had actually been proffered would matter. That foundational point, rooted as it is in the Due Process Clause of the Fifth Amendment, serves as a bright-line rule, buttressed by the Sixth Amendment’s guarantee of trial by jury. The question before us thus becomes whether the plain-error standard of review permits us to disregard the demands of the Due Process Clause and the Sixth Amendment and to affirm a conviction when no evidence was presented to the jury on one of the elements of the charged offense. We think the answer to that question has to be no. To rule otherwise would give us free rein to speculate whether the government could have proven each element of the offense beyond a reasonable doubt at a hypothetical trial that established a different trial record. But no precedent of the Supreme Court or our own has ever sanctioned such an which the existence of an element of the charged crime can be determined, and if the appellate court then searches outside the trial record to discover facts that will fill that void, those appellate judges are indeed finding facts to decide the case. That is antithetical to the right to a jury trial. 33 approach. To the contrary, given the dictates of the Due Process Clause, as described in Winship, 397 U.S. at 364 , our inquiry must necessarily focus on whether the government did prove – or at least introduced sufficient evidence to prove – each element of the offense beyond a reasonable doubt at the actual trial. And Nasir’s right to trial by jury reinforces that point: “Consistent with the jury-trial guarantee, the question [that precedent] instructs the reviewing court to consider is not what effect the constitutional error might generally be expected to have upon a reasonable jury, but rather what effect it had upon the guilty verdict in the case at hand.” Sullivan v. Louisiana, 508 U.S. 275 , 280 (1993) (emphasis added). Plain error is a deferential standard, to be sure, but it does not alter fundamental constitutional precepts.17 Accordingly, the Supreme Court has limited itself to the trial record in analogous cases. The exact procedural posture we are in now was present in Johnson v. United States, 520 U.S. 17 This may be where our views and those of our dissenting colleagues diverge most dramatically. The Dissent says we are “fixate[d] on Winship’s requirement of proof beyond a reasonable doubt in criminal trials” and have a “misconception of plain-error review [that] infects [our] entire discussion of the record … .” (Dissent at 10.) Since Winship only said what the Constitution itself requires, the Dissent might just as well say we are fixated on the Constitution. The intimation is that, if we really understood plain-error review under Rule 52(b), we would not be so bothered by someone’s being convicted without a shred of proof having been introduced at trial on one of the elements of the charged offense. 34 461 (1997). The defendant in that case was convicted of perjury, but, before her direct appeal to the Eleventh Circuit was concluded, the Supreme Court handed down an opinion holding that the materiality of a false statement had to be decided by a jury rather than the trial judge. Id. at 463-64. The defendant had not objected at trial to the judge being the one who made the decision on materiality, because no one at the time knew there was such an objection to be made. Id. at 464. The Eleventh Circuit decided that the error inherent in the judge rather than the jury making the materiality decision did not affect the defendant’s substantial rights. Id. In other words, it decided the case at Olano step three. It made that decision, though, not in spite of a government failure to carry the constitutionally mandated burden of proof but precisely because the government had carried its burden so fully. As described by the Supreme Court, the Eleventh Circuit conducted an “independent review of the record and determin[ed] that … ‘overwhelming’ evidence of materiality” had been provided to the jury, so “[n]o reasonable juror” could have decided the materiality question in any way other than as the trial judge did. Id. at 465 (second alteration in original). The Supreme Court agreed with the outcome but took a different analytical path. It did not address the plain-error analysis in Johnson at Olano step three, as the court of appeals had. Instead, it went directly to step four, and, accepting that the evidence on materiality in the trial record was so “overwhelming” that a rational jury could not reach any conclusion but guilt, the Court decided that the fairness, integrity, and reputation of the judicial process could not be called into question by the conviction. Id. at 469-70. The argument for reversal on plain error failed, in other words, based on the trial record. Johnson thus highlights the 35 importance of the government carrying its constitutional burden at trial.18 18 The Dissent asserts that our “insistence that [the Olano] prong-four analysis is … limited to the time of trial (as memorialized in the trial record) is unwarranted and finds no support in Johnson.” (Dissent at 7-8.) We will leave to thoughtful readers to decide who has more faithfully considered the text of Johnson. Suffice it to say that our reading finds ample support in that text and makes perfect sense, particularly in light of later Supreme Court pronouncements, like those in Neder v. United States, 527 U.S. 1 (1999). In Neder, a similar legal error was at issue. As in Johnson, the district court wrongly decided the issue of the materiality of false statements, this time in a case that included the filing of false tax returns. Over the defendant’s objection, the district judge had instructed the jury that the question of materiality was for the court alone to decide. Looking at the evidence produced by the government at trial, the trial judge found that “the evidence established the materiality of all the false statements at issue.” Id. at 6 . The Eleventh Circuit affirmed the conviction. On review, the Supreme Court applied the harmless-error standard from Chapman v. California, 386 U.S. 18 (1967), because the defendant had lodged an objection to the ruling at issue (in contrast to Nasir and the defendant in Johnson, both of whom were left with plain-error review because they failed to object). In the end, the Supreme Court said that the jury-instruction error was harmless because there was so much evidence of materiality in the trial record that “no jury could reasonably find that Neder’s failure to report substantial amounts of income … was not a ‘material matter.’” 527 U.S. at 16 . So again, it was not in spite 36  Given the due process and Sixth Amendment concerns in play here, we are not free to suppose what the government could have proven at a different trial. The only relevant question, even on plain-error review, is what the government did prove at this trial. Nevertheless, while the constitutional implications of Rehaif seem clear to us, they are not beyond dispute, as the close division among us in this en banc appeal shows and as is further evidenced by decisions from our sister circuits. 2. The Differing Approaches of Other Courts of Appeals With one exception,19 other courts of appeals that have considered whether the government’s failure to prove the of the government’s failure to carry its burden of proof but rather because it had carried its burden so overwhelmingly that the Court upheld the conviction. 19 In United States v. Medley, 972 F.3d 399 (4th Cir. 2020), the Fourth Circuit vacated a defendant’s jury trial conviction on plain-error review after Rehaif because the indictment did not allege knowledge-of-status, the government had presented no evidence of knowledge-of-status at trial, and the jury was not instructed to find knowledge-of-status. However, the Court did not address the issue we confront here, namely whether we are restricted to the trial record on plain- error review of a jury conviction. It is noteworthy, though, that the majority in that case appeared to take it as given that it was limited to the trial record, id. at 417 (noting that the government “provided substantial post-trial evidence 37 knowledge-of-status element in a 922(g) prosecution is plain error have decided that it is not. They have reached that result based on their preliminary conclusion that they are permitted to look outside the trial record to find evidence to plug the gap left by the prosecution at trial. The justifications offered for that view are not all of a piece. See United States v. Huntsberry, 956 F.3d 270 , 284 (5th Cir. 2020) (“We note that our sister courts have taken different paths on this issue.”). Under one line of thinking, the Supreme Court’s decision in United States v. Vonn, 535 U.S. 55 (2002), authorizes consideration of the entire record, not just the trial record, at step three of plain-error review of a jury verdict, even though Vonn was decided in the context of a guilty plea. United States v. Ward, 957 F.3d 691 , 695 & n.1 (6th Cir. 2020); United States v. Reed, 941 F.3d 1018 , 1021 (11th Cir. 2019). A second rationale holds that a reviewing court is limited to the trial record on the first three steps of plain-error review but may look to the entire record at the fourth step, which involves the exercise of discretion in considering potential harm to the reputation of the judiciary. United States v. Owens, 966 F.3d 700 , 706-07 (8th Cir. 2020); United States v. Maez, 960 F.3d 949 , 961 (7th Cir. 2020); United States v. Miller, 954 F.3d 551 , supporting [the defendant’s] knowledge of his prohibited status” but “declin[ing] the Government’s invitation to engage in the level of judicial factfinding that would be required to affirm,” given the trial record), while the dissent appears to have assumed that it was not so limited, id. at 419-20 (Quattlebaum, J., dissenting) (asserting that the conviction should be sustained because the defendant had previously served more than twelve years in prison for second-degree murder, information that was not presented to the jury). 38 560 (2d Cir. 2020). We respectfully disagree with both of those perspectives, neither of which can comfortably co-exist with our own precedent, nor, to our thinking, with due process, the Sixth Amendment, or relevant Supreme Court authority. The trailblazer on the first path – the one resting on the Supreme Court’s decision in Vonn – was the Eleventh Circuit in United States v. Reed, a case initially decided on the basis of the pre-Rehaif state of the law. 941 F.3d at 1019. When the case reached the Supreme Court on certiorari, the Court vacated the judgment and sent the matter back for further proceedings consistent with Rehaif. Id. On remand, the Eleventh Circuit determined that, even though it was reviewing a conviction after a jury trial, it could nonetheless “consult the whole record when considering the effect of any error on [the defendant’s] substantial rights.” Id. at 1021. As authority for that premise, the Court cited Vonn, which held that, when a defendant has entered a guilty plea and later asserts on appeal that there was a failure to ensure the plea’s voluntariness through a colloquy under Rule 11 of the Federal Rules of Criminal Procedure,20 “a [previously] silent defendant has the burden to satisfy the plain-error rule and that a reviewing court may consult the whole record when considering the effect of any error on substantial rights.” 535 U.S. at 59 ; see Reed, 941 F.3d at 1021. Other circuits have cited Reed for the premise that, on plain-error review, an appeals court may satisfy itself of an element with evidence that was never presented to a jury. 20 Under Rule 11, if the defendant has pled guilty, “the court must address the defendant personally in open court and determine that the plea is voluntary and did not result from force, threats, or promises (other than promises in a plea agreement).” Fed. R. Crim. P. 11(b)(2). 39 See United States v. Mancillas, 789 F. App’x 549, 550 (7th Cir. 2020); cf. Ward, 957 F.3d at 695 n.1 (6th Cir. 2020) (citing Vonn, 535 U.S. at 59 ). The problem with Reed and the cases that follow it, however, is that Vonn involved review of the voluntariness of a guilty plea, a procedural posture that is completely unlike the review of a conviction following trial. In Vonn, the Supreme Court held that, in ascertaining the adequacy of a Rule 11 colloquy, a reviewing court may look beyond the colloquy to the record created at a defendant’s initial appearance and arraignment “[b]ecause … defendants may be presumed to recall information provided to them prior to the plea proceeding[.]” Vonn, 535 U.S. at 75 . The focus was, appropriately, on the information known to the defendant at the time of the plea because, when a defendant pleads guilty, the district court must ensure that the plea is knowing and voluntary. That’s the job at the plea stage because it is what due process demands in that context. McCarthy v. United States, 394 U.S. 459 , 466 (1969) (“[I]f a defendant’s guilty plea is not equally voluntary and knowing, it has been obtained in violation of due process and is therefore void.”). And the reviewing court’s job is to make sure of the same thing, which makes it logical to look at what a defendant was told at earlier stages of the criminal proceedings. The question is quite different when reviewing whether the government has borne at a trial – or even at a plea proceeding21 – its burden to “convince the trier [of fact] of all 21 Because we of course acknowledge that a guilty plea must be knowing and voluntary, the Dissent concludes that we are “comfortable inferring a defendant’s knowledge-of-felon 40 the essential elements of guilt.” Winship, 397 U.S. at 361 (citation omitted). In that procedural setting, due process and Sixth Amendment considerations compel us to focus our inquiry on the information presented to the trier of fact – in this case, the jury. Vonn is inapposite where, as here, we are concerned not with the facts possessed by the defendant and their effect on the voluntariness of his plea but with the information presented to the fact-finder to prove an element of the charged offense. Put differently, when there has been a plea rather than a trial, no one is concerned about or mentions the adequacy of the trial record because there is none. Likewise, however, when there has been a trial and an utter status from his prior guilty plea.” (Dissent at 12 n.5.) The Dissent therefore faults us for refusing to consider Nasir’s three prior guilty pleas – especially one for a felon-in-possession charge. That conviction is one that our colleagues especially emphasize as a “central reason” not to correct the plain error here. (Dissent at 12 n.5.) But the fact that a guilty plea must be knowing and voluntary has no bearing on whether we may consider a guilty plea that was never presented to the jury. What divides us has nothing to do with the strength of the evidence outside the trial record. It has everything to do with whether, consistent with constitutional safeguards, we can properly go outside the trial record. And to the extent the Dissent suggests that the government is free to ignore the elements of the charged offense at a plea colloquy, we disagree with that as well. The government must always make a record demonstrating a factual basis for the crime to which the plea is entered. 41 failure of proof is at issue, it is simply beside the point to rely on case law dealing with the voluntariness of plea colloquies.22 22 The Dissent asserts that United States v. Young, 470 U.S. 1 (1985), supports its position, and the position taken in Reed, 941 F.3d at 1020-21, that we must consider evidence outside the trial record when applying Olano step four. (Dissent at 15.) Not so. Although Young does refer to “the entire record,” it does so in a way that, in context, makes plain that what the Supreme Court was referring to was the entire trial record. The full quote from Young reads as follows: Especially when addressing plain error, a reviewing court cannot properly evaluate a case except by viewing such a claim against the entire record. We have been reminded: “In reviewing criminal cases, it is particularly important for appellate courts to relive the whole trial imaginatively and not to extract from episodes in isolation abstract questions of evidence and procedure. To turn a criminal trial into a quest for error no more promotes the ends of justice than to acquiesce in low standards of criminal prosecution.” It is simply not possible for an appellate court to assess the seriousness of the claimed error by any other means. 470 U.S. at 16 (emphasis added) (internal citation and quotation marks omitted). Far from supporting the Dissent or Reed, that statement emphasizes that our focus is supposed to be on the actual field of play – the trial – to see whether the government has fulfilled its constitutional obligations in a way that preserves the fairness and integrity of the prosecution and maintains the confidence of the public. The trial record is the only place to 42  The second rationale adopted by some courts for going beyond the trial record acknowledges that a reviewing court is restricted to the trial record at the first three steps of plain-error review, but then holds that the fourth step changes the scope of review. Since the fourth step of Olano calls for the exercise of discretion, and since that discretion must account for potential harm to the reputation of the judiciary, those courts say it is fine to look outside the trial record because the public will. The reasoning is, in effect, that the defendant is obviously guilty and the justice system will not appear to have served justice if, through no fault of the prosecution, the defendant is freed on the technicality that proof of a previously unknown element of the offense was not offered in evidence.23 which one rightly can look if what is being considered is the trial supposedly under review. For purposes of Olano step four, and for this type of error, the trial is the only judicial proceeding at issue. 23 Applying a different version of this approach, the Fifth Circuit at first declined to answer whether it was limited to the trial record on plain-error review but determined that it could judicially recognize facts at the fourth step of plain-error review, including a defendant’s prior state convictions. See Huntsberry, 956 F.3d at 285-86. Subsequently, however, the Fifth Circuit decided that it is permitted to look outside the trial record at the fourth step. See United States v. Staggers, 961 F.3d 745 , 756 (5th Cir. 2020); see also United States v. Burden, 964 F.3d 339 , 348 n.8 (5th Cir. 2020). In another post-Rehaif case, the First Circuit similarly indicated that judicial notice might be a proper path to resolution, but in the end, it did not take that path. United States v. Lara, --- F.3d ---, Nos. 17-1957, 43  The Second Circuit took essentially that approach in United States v. Miller. In analyzing a Rehaif challenge to jury instructions, the court decided that “the substantial-rights analysis [, i.e., the Olano step three question,] in [the defendant’s] case is a difficult one, given the paucity of factual development at trial pertaining to a question that was not discerned before Rehaif was decided.” 954 F.3d at 559. Because the step-three question was difficult, the court chose “to resolve [the] case on the fourth prong of plain-error review[,] … which does not necessarily confine us to the trial record.” Id. The court cited no authority for that postulate about being free to roam beyond the trial record. It asserted it and then, noting that the presentence investigation report provided ample evidence that the defendant must have known he was a felon, and referencing his stipulation at trial, concluded that the fairness and integrity of the judicial system would not be questioned, even though there was a “paucity” of evidence of his guilt presented at trial. Id. at 559-60. The Seventh Circuit has adopted the same kind of approach. In United States v. Maez, it began by explaining why Vonn is not applicable when reviewing jury convictions, 17-1964, 2020 WL 4668535 , at *13 (1st Cir. Aug. 12, 2020) (noting that “the government had available to it evidence of [the defendant’s] four recent and serious convictions from Maine,” and although it did not present that evidence at trial, “we regularly take judicial notice of … state court records given their presumed reliability”). For the reasons discussed herein, however, we are unpersuaded that judicial notice can properly be used as a means to circumvent a defendant’s rights to due process and trial by jury. 44 distinguishing that case as we have above and saying, “[t]he Supreme Court has made clear that harmless-error analysis [performed at Olano step three] looks only to the trial record to measure the effect of trial error.” Maez, 960 F.3d at 961. It reasoned that such a “restriction to the jury record flows logically from the nature of a substantial-rights inquiry on direct review.” Id. When asking whether a trial error affected substantial rights, “[t]he more abstract question of the defendant’s actual guilt or innocence is not the issue. Rather, the appellate court asks what effect the error could have had on the verdict in the trial actually conducted.” Id. But the court then decided that, because the fourth step of plain-error review is a separate, discretionary step, reviewing courts may, and perhaps should, consider claims of actual innocence. Id. at 962. Having determined that appellate courts “have broad discretion under prong four to leave even plain errors uncorrected where we have no doubt as to the ultimate result of further proceedings[,]” the court decided that step-four “discretion necessarily implies some power to look beyond the trial record to assess an error’s effect, at least for the errors argued here, where … [Old Chief] prevented the government from offering a great deal of circumstantial evidence showing” knowledge-of-status.24 Id. at 963. The only authority cited for looking beyond the trial record was the Second Circuit’s decision in Miller.25 Id. 24 Subsequently, the Seventh Circuit has exercised its discretion to recognize the plain error in a post-Rehaif challenge to a § 922(g) conviction. See United States v. Cook, 970 F.3d 866 (7th Cir. 2020). 25 The First Circuit has also recently joined the ranks of the Second and Seventh Circuits, saying that “the Supreme 45 Court has never suggested that we are categorically barred from taking into account evidence not introduced at trial in considering whether an instructional error satisfies the fourth prong of plain-error review.” Lara, 2020 WL 4668535 , at * 13. Although the Court acknowledged the due process concerns in “revis[ing] the basis on which a defendant is convicted simply because the same result would likely obtain on retrial,” id. at *14 (citation omitted), it nonetheless characterized a reversal in this context as “wasteful” and declined to exercise its discretion to notice the error on the fourth prong of plain-error review, id. at *13-14 . Similarly, the Ninth Circuit has decided that examination of evidence outside the trial record is permissible to avoid “wasteful reversals.” United States v. Johnson, No. 17-10252, 2020 WL 6268027 , at *4 (9th Cir. Oct. 26, 2020) (quoting United States v. Dominguez Benitez, 542 U.S. 74 , 82 (2004)). The court’s Johnson decision had an earlier iteration in which the expressed rationale for looking outside the trial record was the availability of a retrial in the case and the court’s conclusion (suspect, in our view) that the Double Jeopardy Clause is the source of the ordinary prohibition on going beyond the trial record when conducting appellate review. United States v. Johnson, 963 F.3d 847 , 851 (9th Cir. 2020) (vacated). While the unusual Double Jeopardy rationale may have made a cameo appearance in the most recent version of Johnson, see 2020 WL 6268027 , at *4 (“To satisfy the fourth prong when a retrial would be permissible, a defendant must offer a plausible basis for concluding that an error-free retrial might end more favorably.” (emphasis added)), the court’s stated basis for looking past the government’s proof at trial is now more in line with the Olano prong four analysis in Miller and Maez. 46  Our disagreement with this fourth-step approach is that it treats judicial discretion as powerful enough to override the defendant’s right to put the government to its proof when it has charged him with a crime.26 We do not think judicial discretion trumps that constitutional right, and neither Miller nor Maez cite any pre-Rehaif authority supporting a contrary conclusion. Moreover, those decisions and the ones that follow them are independently troubling to the extent they imply that relief on 26 As discussed below, we think the existence of an Old Chief stipulation has little relevance to the analysis and, thus, disagree with the Seventh Circuit’s conclusion that it was justified in straying from the trial record on that basis. To the extent that either the Second or Seventh Circuit (or any other court of appeals) sought to make a broader point that going beyond the trial record was permissible because the government presented all of the evidence it needed to, given the state of the law prior to Rehaif, our views again diverge. Whether fair to the government or not, it does not matter that the change in the law came after trial. The Supreme Court has said that the error must be measured based on the law at the time of appeal. See Henderson, 568 U.S. at 273 (“Johnson explicitly rejects applying the words ‘plain error’ as of the time when the trial judge acted. Instead, Johnson deems it ‘enough that an error be “plain” at the time of appellate consideration’ for that error to fall within Rule 52(b)’s category of ‘plain error.’” (quoting Johnson, 520 U.S. at 468 )). There will be cases that fall in the gap between the state of the law at trial and the state of the law on appeal. This is one. 47 plain-error review is available only to the innocent.27 That is a proposition the Supreme Court put to rest in Rosales-Mireles v. United States, 138 S. Ct. 1897 (2018), when it observed that “Olano rejected a narrower rule that would have called for relief only … where a defendant is actually innocent.” Id. at 1906 . And as for any objection that technicalities can be overlooked on plain-error review, we do not accept that the question of whether we are confined to the trial record is a mere technicality. It is, in our view, a matter of the highest importance. The word “technicality” is too often used to denigrate a principle that stands between an advocate and a preferred result. “All law is technical if viewed solely from 27 The Dissent suggests the same. Indeed, the consistent theme of the Dissent is that, when evidence outside the trial record is considered, it is so obvious that Nasir is guilty that we are “profoundly mistaken” (Dissent at 1) in “persist[ing]” in our desire to correct a plain error of constitutional magnitude that has affected Nasir’s substantial rights. (Dissent at 24.) “[I]n the face of overwhelming, reliable information supporting Nasir’s conviction” (Dissent at 24), our persistence is explained as “a reflexive inclination … to reverse because of unpreserved error[.]” (Dissent at 24 (quoting Puckett v. United States, 556 U.S. 129 , 134 (2009)).) Our view, however, is more reflective than reflexive and is consistent with the Supreme Court’s instruction that “the public legitimacy of our justice system relies on procedures that are neutral, accurate, consistent, trustworthy, and fair, and that provide opportunities for error correction.” Rosales-Mireles v. United States, 138 S. Ct. 1897 , 1908 (2018) (internal quotation marks and citation omitted). 48 concern for punishing crime without heeding the mode by which it is accomplished.” Bollenbach v. United States, 326 U.S. 607 , 614-15 (1946). The Constitution puts procedural safeguards in place to protect against just such an approach. Given the imperative of due process, and “[i]n view of the place of importance that trial by jury has in our Bill of Rights,” it should not be supposed that “the belief of appellate judges in the guilt of an accused, however justifiably engendered by the dead record, [can be substituted] for ascertainment of guilt by a jury under appropriate judicial guidance, however cumbersome that process may be.” Id. at 615 . In sum, we disagree with both variants of the rationales that other courts of appeals have adopted to justify unmooring themselves from the trial record when conducting plain-error review.28 Given our view of the due process and jury trial 28 The Dissent relies heavily on the several cases we have just discussed and others following them, counting the number of courts and judges and asking, “[h]ow could so many federal judges approve the obvious violation of important Fifth Amendment and Sixth Amendment rights?” (Dissent at 16.) We are certainly aware that thoughtful people can analyze the plain-error conundrum here differently than we have. But then, not long ago, there was a contrary consensus that plain-error relief is warranted when the trial record is “devoid of evidence.” See United States v. Castro, 704 F.3d 125 , 138 (3d Cir. 2013) (citation omitted) (collecting cases). More to the point, however, we are making an independent judgment, as we are required to do, and counting up judges who see the issue differently does not alter our obligation. The answer to the old saw that “fifty million Frenchmen can’t be wrong” is yes, they can. Rehaif itself is an example of everyone except the 49 rights at issue, our analysis of Nasir’s claim of plain error will be confined to the trial record and the evidence the government actually presented to the jury. 3. Applying Plain-Error Review Turning to the trial record, and with the first two steps of the plain-error test from Olano not in dispute, the only questions left for our consideration are whether the admitted plain error of a conviction on proof of less than all of the elements of the 922(g) charge affected Nasir’s substantial rights (Olano step three) and whether we should exercise our discretion to notice the error (Olano step four). On this record, the answer to both questions is yes.29 Supreme Court seeing an issue the same way and, given the Supreme Court’s position in our judicial hierarchy, all of them being wrong. 29 That is not to say that all post-Rehaif cases should be resolved in favor of the defendant. Despite the Dissent’s assertions to the contrary, we are not advocating nor effectively establishing a per se rule. Each case must be decided on its own facts. For example, there have been cases where sufficient evidence was presented at trial to show that the defendant was aware of his status as a felon at the time of the crime. See, e.g., United States v. Moss, 812 F. App’x 108, 111 (4th Cir. 2020) (rejecting a Rehaif-based challenge because “[d]uring his direct testimony, [the defendant] stated that he was well aware of his prohibited status because of his prior convictions.”); United States v. Velázquez-Aponte, 940 F.3d 785 , 800 (1st Cir. 2019) (reciting evidence supporting a § 922(g) conviction after Rehaif and noting that, at trial, “the government submitted a 50  a) Olano step three To show that an error affected his substantial rights, Nasir must “‘show a reasonable probability that, but for the error,’ the outcome of the proceeding would have been different.”30 Molina-Martinez v. United States, 136 S. Ct. certified copy of a prior Puerto Rico court judgment reflecting that [the defendant] was convicted of a felony in state court” at trial and “read portions of it to the jury,” including the sentence). The Dissent asserts that these cases are “inapposite” because they did not feature Old Chief stipulations. (Dissent at 14.) But whether there is an Old Chief stipulation is irrelevant. Old Chief was explicit that it does not prevent the introduction of evidence of a prior conviction “for any purpose beyond proving status,” 519 U.S. at 190, so proving knowledge of status was never forbidden by Old Chief and is expressly sanctioned by Federal Rule of Evidence 404(b), which states that “[e]vidence of a crime, wrong, or other act is … admissible for … proving … knowledge[.]” Therefore, as explained further herein, Old Chief stipulations do not prevent the government from introducing knowledge-of-status evidence, as is evident from their continued use post-Rehaif. The Dissent engages in pure speculation when it insists that, but for the stipulation in this case, the government would have introduced such evidence, or that the trial court would have sustained an objection to it. (See Dissent at 14-15.) 30 Although we agree with Nasir that his conviction under § 922(g) was plainly erroneous after Rehaif, we do not agree with his assertion that the error was structural. The Supreme Court has said that “structural errors are a very 51 1338, 1343 (2016) (quoting United States v. Dominguez Benitez, 542 U.S. 74 , 76 (2004)). As to his sufficiency-of-the- evidence challenge,31 we ask whether the evidence the government presented at trial would have been sufficient to sustain a conviction on the knowledge-of-status element. Because literally no evidence was presented concerning Nasir’s knowledge of his status as a felon, it is at least limited class of errors[.]” United States v. Marcus, 560 U.S. 258 , 263 (2010) (citation and internal quotation marks omitted). Those circumstances are not present here, and we are not inclined to extend the structural error doctrine. We have already said that “[t]rial errors resulting from a failure to submit an element of an offense to the jury are not structural defects, but instead, are subject to harmless or plain error analysis.” United States v. Vazquez, 271 F.3d 93 , 103 (3d Cir. 2001) (en banc). That is consistent with the Supreme Court’s decisions in Neder and Johnson, which held that a judge’s mistake in taking from the jury the responsibility to determine the existence of an element of the crime was not structural error. (See supra II.E.1.) 31 Nasir also alleges plain error with respect to the jury instruction on the elements of a § 922(g) offense, but we need not consider those arguments, given our disposition of the sufficiency-of-the-evidence challenge. Failure to instruct the jury as to an element of the crime is trial error, and “[t]he prosecution therefore is free to retry [the] defendant.” McMullen v. Tennis, 562 F.3d 231 , 237 (3d Cir. 2009); see also United States v. Cohen, 301 F.3d 152 , 158 (3d Cir. 2002) (Alito, J.) (“The usual remedy for an error in a jury instruction is retrial[.]”). 52 reasonably probable, if not certain, that the jury would not have found there was proof beyond a reasonable doubt of the knowledge-of-status element, if it had known it was required to consider that element. The government nevertheless argues that the situation here calls for a different result because the defendant stipulated that he was a felon, pursuant to Old Chief, 519 U.S. 172 . According to the government, it was prohibited from giving any further details about Nasir’s criminal record, so it could not have adduced evidence that he knew of his status. That argument echoes a concern raised by Justice Alito in his dissent in Rehaif, in which he said that, now that the government has to prove knowledge-of-status, “under … [Old Chief], it is questionable whether a defendant, by offering to stipulate that he has a prior conviction, can prevent the prosecution from offering evidence about the nature of that offense. And the admission of that information may work to a § 922(g) defendant’s detriment.” Rehaif, 139 S. Ct. at 2209 (Alito, J., dissenting). We understand Justice Alito as making the point that discovering a knowledge-of-status element in § 922(g) was potentially inconsistent with the protections the Supreme Court intended Old Chief to extend to defendants, and that inconsistency, Justice Alito indicated, stood as another reason why the Court’s interpretation of § 922(g) in Rehaif was incorrect. We do not, however, read anything in Rehaif, or Old Chief itself, as suggesting that the government could not have introduced knowledge-of-status evidence at trial. To the contrary, the Supreme Court was explicit in Old Chief that its restrictions on evidence concerning the defendant’s previous felony applied “only when the record of conviction would not 53 be admissible for any purpose beyond proving status,” so that “if, indeed, there were a justification for receiving evidence of [the conviction] on some issue other than status (i.e., to prove . . . ‘knowledge, . . .’), [then Federal Rule of Evidence] 404(b) [would] guarantee[] the opportunity to seek its admission.” 519 U.S. at 190 (emphasis added). Nor did Old Chief preclude adding a simple knowledge- of-status statement to the stipulations the government regularly enters with defendants in § 922(g) cases. By its plain terms, Old Chief only prevents the government from presenting evidence about the name or nature of the defendant’s prior felony conviction. A knowledge-of-status statement included in a stipulation addresses neither of those things. Indeed, such additional language need not reveal any information about a defendant’s felonious past, only that he was aware of it at the time of the offense under consideration. Events in the real world bear that out. As the Seventh Circuit has noted, “[i]n the wake of Rehaif, defendants and the government have begun agreeing to modified Old Chief stipulations that also include knowledge of felon status.” Maez, 960 F.3d at 959. The government also argues that a fair inference, especially on plain-error review, is that Nasir’s acknowledgement of his conviction in the Old Chief stipulation32 means he also acknowledged he knew of his status as a felon ever since becoming one. But Rehaif itself blocks 32 For the language of the stipulation in its entirety, see supra note 3. 54 that line of reasoning.33 The Supreme Court said there that it did not believe “Congress would have expected defendants under § 922(g) … to know their own status[ ].” Rehaif, 139 S. Ct. at 2197 . If one were to conclude otherwise, the Court said, “these provisions might apply to a person who was convicted of a prior crime but sentenced only to probation, who does not know that the crime is ‘punishable by imprisonment for a term exceeding one year.’” Id. at 2198 (quoting 18 U.S.C. § 922 (g)(1)). In the natural course, a defendant agrees to an Old Chief stipulation after having committed the crime of unlawfully possessing a firearm. Nasir’s stipulation, for example, post- dates his offense by sixteen months. All the stipulation demonstrates is that he knew he was a felon at the time he signed the stipulation; based on the stipulation alone, it cannot rightly be said that he knew of his status as a felon when he possessed the firearms at issue.34 In other words, a stipulation 33 That is not to say that the government’s argument is without support. See Ward, 957 F.3d at 696 (“A rational juror could also have inferred that [the defendant] knew he was a felon when he possessed the gun. [He] made an Old Chief stipulation at trial, pursuant to which he acknowledged that he ‘was a convicted felon on and prior to the date of the charged conduct[.]’ [His] lawyer also told the jury that [the defendant] was ‘stipulating that he has a felony. So you can check that one off the box.’ The jury could have inferred from these statements that [the defendant] also knew that he was a felon.”). 34 While the Dissent agrees that the stipulation does not “necessarily prove that [Nasir] knew he was a felon when he 55 of the sort submitted in this case will not, on its own, suffice to prove that, at the relevant time, the defendant had knowledge of his status as a person prohibited to possess a firearm.35 was arrested with the gun[,]” it nonetheless asserts that “[a] thoughtful observer drawing upon her reason, experience, and common sense might easily infer from Nasir’s June 2017 stipulation that he knew of his felon status when apprehended with a gun in December 2015.” (Dissent at 19-20 n.9.) How a thoughtful observer would get to that conclusion at all, let alone easily, can only be explained by going outside the trial record. On the basis of what is in that record, only an illogical leap could get to that conclusion. Again, Nasir entered into his Old Chief stipulation long after he was apprehended with the guns, and he stipulated only that he was a felon; he did not stipulate to his state of knowledge at the time of the alleged crime. A thoughtful observer, therefore, would not – indeed could not – rightly infer knowledge-of-status at the relevant time from the Old Chief stipulation, either alone or in combination with anything else the Dissent can point to. There simply is no basis for that inference in the trial record. 35 The government also argues that, because Nasir agreed to an Old Chief stipulation, the situation is analogous to one where the defendant invited the error. But that argument is a non-starter since, under our precedent, the invited-error doctrine does not apply where the law changes between trial and appeal. United States v. Andrews, 681 F.3d 509 , 517 n.4 (3d Cir. 2012); United States v. West Indies Transp., Inc., 127 F.3d 299 , 305 (3d Cir. 1997). 56  The government tries to get around its lack of evidence by saying that, at trial, it showed Nasir was furtive about his drug dealing and so he must have known when he possessed his guns that he was a convicted felon.36 But the inference simply does not follow. Criminal behavior is nearly always furtive; it’s in the very nature of the thing. Criminals know enough to hide their criminality, if they can. Nasir’s furtiveness proves only that he knew his drug dealing could get him into trouble, not that he knew he was a previously convicted felon.37 If the government’s argument were accepted, prosecutors in a typical case involving drugs and guns could put on no more evidence than was offered before Rehaif and then, by calling the defendant’s behavior furtive, gain a conviction. That would render Rehaif a nullity and is 36 Specifically, the government points to “the evidence of subterfuge involving the use of the separate storage facility to store drugs and drug paraphernalia [and] the fact that he had a secondary vehicle in which he had an arsenal of five semiautomatic firearms.” (En Banc Oral Argument at 1:03:45–1:04:35; see also App. at 393–94 (trial testimony describing Nasir’s behavior at the storage facility as involving “frequent visits” to a “small unit” where Nasir “would go inside and come back out”).) 37 The government further argues that the fact Nasir kept his weapons hidden and locked in the trunk of his car shows he knew he was prohibited from possessing firearms. If we were to accept that argument, it might imply that a gun owner who responsibly keeps his guns safely locked away is somehow admitting his ownership of them is illicit. We think the inference unwarranted. 57 obviously not an option. Rehaif declares knowledge of status to be an element of a § 922(g) offense, and that cannot be ignored. The Fourth Circuit has recently come to the same conclusion. In United States v. Medley, 972 F.3d 399 (4th Cir. 2020), it recognized plain error when the government presented no evidence to sustain a conviction on the knowledge-of-status element. 38 Id. at 402-03 . There too, the government asserted that the defendant’s Old Chief stipulation was evidence of knowledge-of-status, as was his “attempt to evade the police[.]” Id. at 414-15 . The court disagreed, noting that “[i]nferring that someone knew he was prohibited from possessing a firearm at the time of the offense based on a stipulation at trial that he was in fact a prohibited person would render the Supreme Court’s language in Rehaif pointless.” Id. at 414 . It also noted that the defendant’s “attempt to evade the police … does not indicate—much less overwhelmingly prove—that he knew his prohibited status under federal law.” Id. at 415 . 38 In Medley, the Fourth Circuit found plain error and prejudice in the indictment, in the jury instructions, and in the sufficiency of the evidence presented at trial. Id. at 419 . It then exercised its discretion to recognize the error at step four of plain-error review, in light of the cumulative effect of those three errors. Id. Rather than delving into our agreements or disagreements with the majority and dissenting opinions in that case, we note that we certainly agree with the foundation of the majority’s analytical approach – that due process and the right to a jury trial are implicated here. 58  As was the Fourth Circuit in Medley, we are faced here with a case in which there is no evidence at all on an essential element of the felon-in-possession charge, and yet the case was submitted to the jury and there was a conviction. We have said in unmistakable terms that “affirming a conviction where the government has failed to prove each essential element of the crime beyond a reasonable doubt ‘affect[s] substantial rights[.]’” United States v. Gaydos, 108 F.3d 505 , 509 (3d Cir. 1997) (quoting Olano, 507 U.S. at 732 ) (first alteration in original). That conclusion is “consistent with the Supreme Court’s instruction that due process requires ‘proof beyond a reasonable doubt of every fact necessary to constitute the crime with which [the defendant] is charged.’” United States v. Xavier, 2 F.3d 1281 , 1287 (3d Cir. 1993) (quoting Winship, 397 U.S. at 364 .). Nasir’s substantial rights were thus definitely affected by his conviction upon proof of less than all of the elements of the offense outlawed by § 922(g), and he has carried his burden at Olano step three. b) Olano step four The final question, at Olano step four, is whether we should exercise our discretion to notice the error because it is of a sort that would “seriously affect the fairness, integrity, or public reputation of judicial proceedings.” Olano, 507 U.S. at 736 . Given the significant due process and Sixth Amendment concerns at issue, which we have already discussed at length, we are convinced that it is indeed that sort of error. The Supreme Court recently affirmed in Rosales- Mireles that an error need not “shock the conscience” or amount to a “powerful indictment of the system” to be “worthy of correction” at step four of a plain-error analysis. 138 S. Ct. 59 at 1906-07 (internal quotation marks omitted). Again, the Court said that “Olano rejected a narrower rule that would have called for relief only” in cases “where a defendant is actually innocent.” Id. at 1906 . It recognized instead “a broader category of errors that warrant correction on plain-error review.” Id. Innocence or guilt, insofar as we may think we apprehend them based on the trial record, may have relevance, but our analysis at the fourth step “focus[es] … on principles of fairness, integrity, and public reputation[.]” Id. That means that sometimes the errors to be corrected are “inadvertent or unintentional errors of the court or the parties below.” Id. In Rosales-Mireles, the error was the District Court’s miscalculation of the guidelines range at sentencing. Id. at 1905 . Such errors had already been recognized as being likely to affect a defendant’s substantial rights, when considered under the third step of plain-error review. See Molina-Martinez, 136 S. Ct. at 1345 (“When a defendant is sentenced under an incorrect [g]uidelines range—whether or not the defendant’s ultimate sentence falls within the correct range—the error itself can, and most often will, be sufficient to show a reasonable probability of a different outcome absent the error.”). The Supreme Court extended that reasoning to Olano step four, saying that “‘[t]o a prisoner,’ th[e] prospect of additional ‘time behind bars is not some theoretical or mathematical concept’ … [and] thus warrants serious consideration in a determination whether to exercise discretion under Rule 52(b).” Rosales-Mireles, 138 S.C.t at 1907 (quoting Barber v. Thomas, 560 U.S. 474 , 504 (2010) (Kennedy, J., dissenting)). The Court observed that “[i]t is crucial in maintaining public perception of fairness and integrity in the justice system that courts exhibit regard for 60 fundamental rights and respect for prisoners as people.” Id. at 1907 (internal quotation marks omitted). If a guidelines miscalculation warrants recognition of plain error, surely a plain error of constitutional dimension going to the conviction itself deserves to be recognized and corrected.39 Nasir was deprived of the right to have a jury 39 We do not suggest, as the Dissent contends, that “plain-error review is inapplicable whenever important constitutional rights are at issue.” (Dissent at 11 n.4.) Instead, we faithfully apply our discretion at Olano step four within the confines of the trial record, evaluating whether the constitutional deprivation at issue seriously impugns the fairness, integrity, and public reputation of judicial proceedings. By limiting the scope of our review to the trial record, we decline to act as a factfinder or to do the government’s job for it. That exercise of judicial restraint does not create a per se rule, nor does it “challenge[ ] the constitutionality of Rule 52(b)’s plain-error standard as explicated in Supreme Court decisions[,]” as the Dissent charges. (Dissent at 11 n.4).) There are cases, as we’ve previously noted (supra note 29), in which sufficient evidence was presented at trial to show that a defendant was aware of his status as a felon at the time of the crime charged. See, e.g., Moss, 812 F. App’x at 111; Velázquez-Aponte, 940 F.3d at 800. Thus, it is not a foregone conclusion that every defendant convicted before Rehaif under § 922(g) – even every such defendant who entered into an Old Chief stipulation – will succeed on plain error review. Old Chief stipulations do not now prevent, nor have they ever prevented, the government from introducing knowledge-of-status evidence. To the contrary, the government has already begun including 61 consider whether the government had proven him guilty beyond a reasonable doubt on every element of the § 922(g) charge. As forcefully described in the concurrence on this point, upholding that outcome would amount to an appellate court, in the jury’s stead, “mak[ing] a factual determination on an unproven element of an offense by considering documents outside the evidentiary record,” in derogation of the Sixth Amendment. (J. Matey Concurrence at 2.) Whether viewed as a matter of the Fifth Amendment’s guarantee of due process or the Sixth Amendment’s promise of trial by jury, or both, a deprivation of those essential rights “seriously impugns ‘the fairness, integrity and public reputation of judicial proceedings[,]’” and thus satisfies step four of Olano. Gaydos, 108 F.3d at 509 (quoting Olano, 507 U.S. at 732 ). That cannot be swept aside because of dissatisfaction with the rule that plain error is decided on the basis of the law as it stands at the time of appeal. See Johnson, 520 U.S. at 468 (plainness of a trial error must be judged “at the time of appellate consideration”). True enough, the rules of the game changed here, when the decision in Rehaif came down after the trial. That, however, does not change our constitutional norms. Members of the public know that the government is supposed to prove a defendant’s guilt at trial. Everybody acknowledges that that was not done in this case, though it was nobody’s “fault.” Were we to ignore that breach of due process and then try to explain our choice by saying, “well, we all know he’s knowledge-of-status affirmations within Old Chief stipulations. Maez, 960 F.3d at 959. The variable, therefore, never was the stipulation; it was the government’s lack of awareness that it had to prove the knowledge-of-status element. 62 guilty,” it should not sit well with thoughtful members of the public. Nor should our taking over the jury’s role, for the sake of efficiency. Disregarding constitutional norms may be taken as tantamount to saying that rules constraining the government really don’t count when we just know someone is guilty.40 40 Faulting us for adhering firmly to the demands of due process, the Dissent asserts that “framing the plain error as a due-process violation does not automatically satisfy Olano prong three or four.” (Dissent at 7.) We agree. Labels are not what matter; substance is. To recap, looking at what happened in this case, and considering Olano prong three, not even our dissenting colleagues try to say that the government actually offered at trial any evidence of Nasir’s knowledge of his status as a previously convicted felon. So, again, there was a complete failure of proof on that essential element of the § 922(g) charge, and it ought to be a matter of common understanding that a failure to prove all the elements of an offense does affect substantial rights, as our past precedent tells us. See United States v. Jones, 471 F.3d 478 , 480 (3d Cir. 2006) (“[A]ffirming a conviction where the government has failed to prove each essential element of the crime beyond a reasonable doubt affect[s] substantial rights … .” (internal quotation marks omitted) (second alteration in original)). So prong three is satisfied here, not because we are “framing” the government’s failure as one of due process but because it indisputably is a matter of due process, implicating one of the most fundamental protections afforded to an accused. As for prong four of Olano, we likewise are not saying that labels carry the day. We are focused on the fundamental right, enshrined in the Due Process Clause, that no one will be deprived of liberty without the government carrying its burden to prove guilt beyond a reasonable doubt. When that is at issue, 63 That is a message likely to call into question the fairness, integrity, and reputation of the justice system. We will therefore exercise our discretion to recognize the plain error in Nasir’s § 922(g) conviction. 4. The Remedy for the Plain Error We view this case as a misapprehension about the law – one shared by everyone in the courtroom, and perhaps across the nation, until Rehaif. That misapprehension led to the government’s failure to present sufficient evidence to sustain the conviction.41 Though a failure of proof usually results in acquittal, the Double Jeopardy Clause is not implicated when as it is here, we believe it does bring the judicial process into disrepute to ignore what the Constitution requires. See id. (“[A]ffirming a conviction where the government has failed to prove each essential element of the crime beyond a reasonable doubt … seriously impugns the fairness, integrity and public reputation of judicial proceedings.” (internal quotation marks omitted)). We are not asking for anything to be “automatic” but are taking this case on its facts, as the government and the defendant developed those facts at trial. That, we believe, is what the Supreme Court meant when it said in Puckett v. United States that “the fourth prong [of Olano] is meant to be applied on a case-specific and fact-intensive basis.” 556 U.S. 129 , 142 (2009). By contrast, the Dissent does seem to have an automatic approach: invoking Olano automatically makes every constitutional protection a matter of pure discretion, for judges to ignore if they choose. 41 See supra note 31. 64 the law has changed on appeal.42 Retrial is thus allowed and warranted. We will therefore vacate Nasir’s conviction on the § 922(g) count of the indictment, and we will remand for a new trial on that charge, at the government’s discretion. III. CONCLUSION The frustration of diligent prosecutors in this case is to be expected and is fully justified. They did not know they had 42 See, e.g., United States v. Ford, 703 F.3d 708 , 711-12 (4th Cir. 2013) (granting a new trial where “the evidence presented at trial has been rendered insufficient only by a post- trial change in law … [and] was therefore akin to a reversal for trial error, [so] retrial did not run afoul of the Double Jeopardy Clause.” (internal quotation marks and citations omitted)); United States v. Wacker, 72 F.3d 1453 , 1465 (10th Cir. 1995) (“Moreover, the government here cannot be held responsible for ‘failing to muster’ evidence sufficient to satisfy a standard which did not exist at the time of trial.” (citation omitted)); United States v. Weems, 49 F.3d 528 , 531 (9th Cir. 1995) (holding that “double jeopardy protections do not bar retrial” when “[t]he government had no reason to introduce such evidence because, at the time of trial, under the law of our circuit, the government was not required to prove” that element); see also Rehaif, 139 S. Ct. at 2201 (Alito, J., dissenting) (noting that, following the majority’s decision, “[a] great many convictions will be subject to challenge, threatening the release or retrial of dangerous individuals whose cases fall outside the bounds of harmless-error review.”). 65 to, and hence did not, present evidence to the jury to prove that the defendant knew he was a felon when he possessed a firearm. Likewise, the burden on the busy District Court is regrettable, since it too was operating on the then-widely shared understanding of the elements of a § 922(g) offense. Nevertheless, “[t]he prosecution’s failure to prove an essential element of the charged offense [is] plain error [and]… a miscarriage of justice.” United States v. Castro, 704 F.3d 125 , 138 (3d Cir. 2013) (citations omitted). In sum, we will affirm Nasir’s conviction under the crack house statute and for possession with intent to distribute marijuana. We will vacate his sentence, as it was based on the application of the career offender enhancement that we have here concluded should not be applied, and we will vacate his conviction as a felon in possession of a firearm. Accordingly, we will remand for a new trial on that charge and for resentencing. 66 BIBAS, Circuit Judge, concurring in part. Judges interpret the law. That applies to the U.S. Sentenc- ing Guidelines too. If the Sentencing Commission’s commen- tary sweeps more broadly than the plain language of the guide- line it interprets, we must not reflexively defer. The judge’s lodestar must remain the law’s text, not what the Commission says about that text. So too here. The plain text of the Guidelines’ career- offender enhancement does not include inchoate crimes. The commentary says that it does. The majority rightly rejects this extra-textual invitation to expand a serious sentencing en- hancement, and I join Part II.D of its opinion. But the narrow scope of today’s holding hints at a broader problem. For decades, we and every other circuit have fol- lowed the Supreme Court’s guidance in Stinson. That meant we gave nearly dispositive weight to the Sentencing Commis- sion’s commentary, not the Guidelines’ plain text. 508 U.S. at 44–46; see also, e.g., United States v. Keller, 666 F.3d 103 , 108–09 (3d Cir. 2011); United States v. Boggi, 74 F.3d 470 , 474–75 (3d Cir. 1996). Now the winds have changed. In Kisor, the Supreme Court awoke us from our slumber of reflexive deference: agency in- terpretations might merit deference, but only when the text of a regulation is truly ambiguous. Before deferring, we must first exhaust our traditional tools of statutory construction. Any- thing less is too narrow a view of the judicial role. We must look at things afresh. Old precedents that turned to the commentary rather than the text no longer hold. See 1 Hassen v. Gov’t of the V.I., 861 F.3d 108 , 114 n.5 (3d Cir. 2017) (noting that we may revisit our precedents when they conflict with intervening Supreme Court precedent). Tools of statutory interpretation have thus been thrust to the fore. And one tool among many stands out as well suited to the task: the rule of lenity. As we rework our Sentencing Guidelines cases, lenity is the tool for the job. I. THE RULE OF LENITY’S VIRTUES As Chief Justice Marshall explained, the rule of lenity is venerable. “The rule that penal laws are to be construed strictly, is perhaps not much less old than construction itself.” United States v. Wiltberger, 18 U.S. (5 Wheat.) 76, 95 (1820). It first arose to mitigate draconian sentences. As English statutes kept expanding the death penalty and curtailing mercy, courts tem- pered them by construing them narrowly. Livingston Hall, Strict or Liberal Construction of Penal Statutes, 48 Harv. L. Rev. 748 , 749–51 (1935). The canon was well established by the time of Blackstone. 1 William Blackstone, Commentaries *88. And it took root in our law soon thereafter. Wiltberger, 18 U.S. (5 Wheat.) at 95. Under the rule of lenity, courts must construe penal laws strictly and resolve ambiguities in favor of the defendant. See, e.g., Liparota v. United States, 471 U.S. 419 , 427 (1985); see also Antonin Scalia & Bryan A. Garner, Reading Law: The In- terpretation of Legal Texts 296 (2012). The touchstone is the text: the “ordinary,” evidently intended meaning of “the words of the statute.” Wiltberger, 18 U.S. (5 Wheat.) at 95. 2  The rule of lenity serves three core values of the Republic. First, it is entwined with notice and thus due process. See McBoyle v. United States, 283 U.S. 25 , 27 (1931) (Holmes, J.); United States v. R.L.C., 503 U.S. 291 , 309 (1992) (Scalia, J., concurring). It gives citizens fair warning of what conduct is illegal, ensuring that ambiguous statutes do not reach beyond their clear scope. Second is the separation of powers. As Chief Justice Mar- shall explained, the rule of lenity stems from “the plain princi- ple that the power of punishment is vested in the legislative, not in the judicial department. It is the legislature, not the Court, which is to define a crime, and ordain its punishment.” Wiltberger, 18 U.S. (5 Wheat.) at 95. If Congress wants to criminalize certain conduct or set certain penalties, it must do so clearly. And third but perhaps most importantly, the rule of lenity serves our nation’s strong preference for liberty. As Judge Henry Friendly explained, lenity expresses our “instinctive dis- taste against men languishing in prison unless the lawmaker has clearly said they should.” Henry J. Friendly, Mr. Justice Frankfurter and the Reading of Statutes, in Benchmarks 196, 209 (1967). That approach fits with one of the core purposes of our Constitution, to “secure the Blessings of Liberty” for all citizens. U.S. Const. pmbl. Penal laws pose the most severe threats to life and liberty, as the Government seeks to brand people as criminals and lock them away. To guard against those threats, the rule of lenity favors respect for individual rights. Wiltberger, 18 U.S. (5 Wheat.) at 95. Together with the Double Jeopardy and Cruel and Unusual Punishments Clauses, 3 lenity is a longstanding safeguard against excessive punish- ment. John F. Stinneford, Dividing Crime, Multiplying Punish- ments, 48 U.C. Davis L. Rev. 1955 , 1982–2001 (2015). II. LENITY, SENTENCING, AND KISOR An agency’s reading of its own regulation used to be almost dispositive. That applied equally to the U.S. Sentencing Com- mission and its commentary. Stinson, 508 U.S. at 44–46. But no more. Now, before a court defers to an agency interpreta- tion, first it “must exhaust all the ‘traditional tools’ of construc- tion.” Kisor, 139 S. Ct. at 2415 (quoting Chevron USA Inc. v. NRDC, 467 U.S. 837 , 843 n.9 (1984)). “[O]nly when that legal toolkit is empty and the interpretive question still has no single right answer” may we give Auer deference to an agency’s read- ing of its own rule. Id.; see Auer v. Robbins, 519 U.S. 452 , 461 (1997). A key tool in that judicial toolkit is the rule of lenity. Rather than defer to the commentary, we should use lenity to interpret ambiguous Guidelines. Even though the Guidelines are advi- sory, they exert a law-like gravitational pull on sentences. See United States v. Booker, 543 U.S. 220 , 265 (2005) (Breyer, J., remedial majority opinion); Peugh v. United States, 569 U.S. 530 , 543–44 (2013); U.S. Sentencing Comm’n, 2019 Annual Report and Sourcebook of Federal Sentencing Statistics 8 (re- porting that last year, 75% of offenders received sentences that were either within the Guidelines range or justified by a Guide- lines ground for departure). So courts must still attend to the rule and its animating principles. 4  Lenity’s third, key purpose applies here. True, one can de- bate the relevance of its first two purposes: whether the com- mentary gives enough notice and whether congressional ap- proval of guidelines with their commentary respects the sepa- ration of powers. Compare Mistretta v. United States, 488 U.S. 361 , 380–411 (1989), with id. at 422–27 (Scalia, J., dissenting). But in any event, the presumption of liberty remains crucial to guarding against overpunishment. When a guideline is ambig- uous, the rule of lenity calls for adopting the more lenient of two plausible readings. It helps ensure that “criminal punish- ment . . . represents the moral condemnation of the commu- nity.” United States v. Bass, 404 U.S. 336 , 348 (1971). There is no compelling reason to defer to a Guidelines com- ment that is harsher than the text. Whatever the virtues of giv- ing experts flexibility to adapt rules to changing circumstances in civil cases, in criminal justice those virtues cannot outweigh life and liberty. Efficiency and expertise do not trump justice. Though expertise improves things for the future, sentencing re- quires justice tethered to the past. The rule of lenity takes prec- edence as a shield against excessive punishment and stigma. That does not mean that lenity displaces all commentary. Only when a comment to an otherwise ambiguous guideline has a clear tilt toward harshness will lenity tame it. Some pro- visions may have no consistent tilt across all defendants. If so, Auer deference might still apply. Here, however, the guideline’s plain text does not include inchoate offenses. The commentary says it does, making it harsher. So we rightly refuse to defer. 5  ***** Courts play a vital role in safeguarding liberty and checking punishment. That includes reading the Sentencing Guidelines. Some provisions are ambiguous. But as Kisor teaches, instead of deferring to the commentary the moment ambiguity arises, judges must first exhaust our legal toolkit. This will require work; our old precedents relying strictly on the commentary no longer bind. In undertaking this task, we must not forget the rule of lenity. 6 MATEY, Circuit Judge, concurring. I concur in the majority opinion in full and write separately as to Part II.E. Start with this question: how many people serving on a jury in the United States know exactly what it means to be “a felon?” Most, we can guess, know that a felon has run into some trouble with the law. Others, that the person has been convicted of a crime. A particularly serious crime, at least some might say. But how many of the twelve would know the precise definition used by Congress in 18 U.S.C. § 922 (g)(1), someone “who has been convicted in any court of, a crime punishable by imprisonment for a term exceeding one year”? No matter, of course. The government will explain it all as it proves the elements of § 922(g). And along the way, a few jurors will be surprised to learn that a felony is a very particular kind of crime. That despite countless depictions in culture, both popular and timeless, a “felon” is not just a “villain.” See, e.g., Felon, Webster’s Third New International Dictionary 836 (1993). Now ask a harder question: if at least some of those jurors need the arguments of a lawyer to get to the right meaning of “felon,” then will they all, unanimously and inevitably, conclude that the defendant knew it, too? Perhaps the government’s evidence does not add up. Recollections fade, records fail to materialize, witnesses flounder. Might not the defendant’s attorney find a chance to sow doubt? Then, end with the most challenging question: what if those jurors never heard any evidence that the defendant knew he met the exacting definition of “felon” in § 922(g)? That is 1 the issue before us today, an issue that has in recent years appeared throughout the federal courts. And I believe it requires us to properly frame the question presented. On the one hand, we can view the issue as whether the fourth prong of Olano’s standard of review for plain error should allow an appellate court to “look outside the record” to find proof of guilt that would affirm an otherwise invalid conviction. On the other hand, we can ask whether the Sixth Amendment as originally understood includes an exception to the guarantee that an impartial jury determines a defendant’s guilt. An exception that allows appellate courts to independently find an element of an offense proven beyond a reasonable doubt, using proof never presented to the jury. It is an important distinction because when confronted with a novel question of constitutional law, that is, one not directly controlled by precedent, we should ask if the original understanding of the Constitution tolerates a certain result. No court, it appears, has considered whether the Sixth Amendment, as originally understood, allows judges to make a factual determination on an unproven element of an offense by considering documents outside the evidentiary record. Applying that test, I have sufficient doubt that the scope of judicial authority imagined by the Framers reaches past the horizon of the Sixth Amendment’s guarantee. And I do not read Olano, as best understood in light of the history of the plain error doctrine, to allow for a result contrary to the original understanding of the Sixth Amendment. For those reasons, as I explain below, I concur.1 1 This distinction—whether precedent already answers the question—accounts for the outcome in United States v. 2  I. THE SIXTH AMENDMENT A. The Original Understanding of the Right to a Jury Trial “Only a jury, acting on proof beyond a reasonable doubt, may take a person’s liberty. That promise stands as one of the Constitution’s most vital protections against arbitrary government.” United States v. Haymond, 139 S. Ct. 2369 , 2373 (2019). Ever distrustful of authority, the first generation of Americans skeptically—and belatedly—agreed to sturdier national power as long as certain stipulations bound their new government. Among them, the guarantee that criminal guilt is determined only by an “impartial jury.” U.S. Const. amend. VI. Hardly an American innovation, this “ancient rule,” Haymond, 139 S. Ct. at 2376, between free persons and their governments has “extend[ed] down centuries,” Apprendi v. New Jersey, 530 U.S. 466 , 477 (2000).2 Indeed, “[a]s Blackstone explained, no Jabateh, where the panel held that prior decisions precluded application of the plain error rule. See 974 F.3d 281 , 298–300 (3d Cir. 2020). 2 For examples of this history, begin with the outrages that drove the Stamp Act Congress of 1765 to pronounce that “trial by jury is the inherent and invaluable right of every British subject in these colonies.” Resolutions of the Stamp Act Congress § 7 (1765) reprinted in Select Charters and Other Documents Illustrative of American History 1606–1775, 315 (William McDonald ed., 1906); see also “To Benjamin Franklin from Charles Thomson, Sept. 24, 1765,” Founders Online, National Archives, https://founders .archives.gov/documents/Franklin/01-12-02-0149 (“It is not 3 property only we contend for. Our Liberty and most essential privileges are struck at: Arbitrary courts are set over us, and trials by juries taken away.”); and see “To Benjamin Franklin from Thomas Wharton, June 24, 1765,” Founders Online, National Archives, https://founders.archives.gov/documents /Franklin/01-12-02-0091 (objecting to a single judge deciding what was “heretofore only to be Assertained by a trial by Jury; and thereby depriving Us, of one of the most Essential priviledges of An Englishman.”). This “essential privilege” enjoyed by the colonists “by the immutable laws of nature” included entitlement “to the common law of England, and more especially to the great and inestimable privilege of being tried by their peers of the vicinage, according to the course of that law.” Declaration and Resolves of the First Continental Congress Resolution 5 (1774), available at https://avalon.law .yale.edu/18thcentury/resolves.asp; see also Declaration and Resolves of the First Continental Congress (noting that Britain passed “several acts” which “deprive the American subject of trial by jury” and “deprive[] the American subject of a constitutional trial by jury of the vicinage”). As the evidence for independence mounted, the right to jury trial emerged as profound motivation for the colonies to join in revolt. “IV. The Declaration as Adopted by Congress, [6 July 1775],” Founders Online, National Archives, https://founders.archives.gov /documents/Jefferson/01-01-02-0113-0005 (“Statutes have been passed . . . for depriving us of the accustomed and inestimable Privilege of Trial by Jury in Cases affecting both Life and Property”). It would become a cornerstone of a “new Government,” one of the foundational principles “most likely to effect . . . Safety and Happiness.” The Declaration of 4 Independence ¶ 1, 19 (1776) (“For depriving us in many cases, of the benefits of Trial by Jury”). With freedom won, the future of the right to trial by jury became a central cause for supporters and opponents of the Constitution. Writing as Phocion to persuade New York to ratify, Alexander Hamilton urged, “Let us not forget that the constitution declares that trial by jury in all cases in which it has been formerly used, should remain inviolate forever[].” Second Letter from Phocion, [Apr. 1784], Founders Online, National Archives, https://founders.archives.gov/documents /Hamilton/01-03-02-0347. Fearing a loss of the jury stirred Anti-Federalist Patrick Henry to exclaim: “Why do we love this trial by jury? Because it prevents the hand of oppression cutting you off.” 3 Debates on the Adoption of the Federal Constitution 545 (Philadelphia, Jonathan Elliot ed., 1836) (1787) (statement of Patrick Henry)); see also Nathaniel Breading, Edmund Randolph, and Samuel Bryan, Observations on the Proposed Constitution for the United States of America 23, 1788 (“We abhor the idea of losing the transcendent privilege of trial by jury.”). Indeed, “[t]he friends and adversaries of the plan of the Convention, if they agree in nothing else, concur at least in the value they set upon the trial by jury; or if there is any difference between them it consists in this: the former regard it as a valuable safeguard to liberty; the latter represent it as the very palladium of free government.” Alexander Hamilton, The Federalist No. 83. And so the Anti-Federalists campaigned vigorously to formally recognize the right to jury trial as “essential in every free country, that common people should have a part and share of influence, in the judicial as well as in the legislative department.” Letters From The Federal Farmer (IV), in 2 The 5 person could be found guilty of a serious crime unless ‘the truth of every accusation . . . should . . . be confirmed by the unanimous suffrage of twelve of his equals and neighbors, indifferently chosen, and superior to all suspicion.’” Ramos v. Louisiana, 140 S. Ct. 1390 , 1395 (2020) (citing 4 W. Blackstone, Commentaries on the Laws of England *343 (1769)). And so the Constitution’s jury trial guarantee “reflect[s] a fundamental decision about the exercise of official power—a reluctance to entrust plenary powers over the life and liberty of the citizen to one judge or to a group of judges.” Duncan v. Louisiana, 391 U.S. 145 , 156 (1968). It is a belief that Blackstone called “the grand bulwark of . . . libert[y].” 4 W. Blackstone, Commentaries *349. The Sixth Amendment provides, “as its most important element, the right to have the jury, rather than the judge, reach Complete Anti-Federalist 249 (Herbert J. Storing ed., 1981); see also Letters From The Federal Farmer (XV), in 2 The Complete Anti-Federalist 320 (Herbert J. Storing ed., 1981) (“Juries are constantly and frequently drawn from the body of the people, and freemen of the country; and by holding the jury’s right to return a general verdict in all cases sacred, we secure to the people at large, their just and rightful controul in the judicial department.”). As summed up by Thomas Jefferson, “[a]nother apprehension is that a majority cannot be induced to adopt the trial by jury; and I consider that as the only anchor, ever yet imagined by man, by which a government can be held to the principles of its constitution.” “From Thomas Jefferson to Thomas Paine, 11 July 1789,” Founders Online, National Archives, https://founders.archives.gov/documents /Jefferson/01-15-02-0259. 6 the requisite finding of ‘guilty.’” Sullivan v. Louisiana, 508 U.S. 275 , 277 (1993) (citing Sparf v. United States, 156 U.S. 51 , 105–06 (1895)). From this flows the “unmistakable” condition that a “jury must reach a unanimous verdict in order to convict.” See Ramos, 140 S. Ct. at 1395. And for a jury to be unanimous, the Fifth Amendment requires a unanimous finding of guilt on “all elements” of the charged offense. Sullivan, 508 U.S. at 277–78. “Together, these pillars of the Bill of Rights,” Haymond, 139 S. Ct. at 2376 , ensure that “[t]he Constitution gives a criminal defendant the right to have a jury determine, beyond a reasonable doubt, his guilt of every element of the crime with which he is charged.” United States v. Gaudin, 515 U.S. 506 , 522–23 (1995) (emphasis added). It is, in short, a bedrock precept that remains unmoved by the perpetual current that otherwise defines our Republic. B. Judicial Interpretations of the Jury Trial Right As Justice Scalia so aptly analogized, “[w]hen this Court deals with the content of th[e] [right to jury] guarantee— the only one to appear in both the body of the Constitution and the Bill of Rights—it is operating upon the spinal column of American democracy.” Neder v. United States, 527 U.S. 1 , 30 (1999) (Scalia, J., concurring in part and dissenting in part). Indeed, “together with the right to vote, those who wrote our Constitution considered the right to trial by jury ‘the heart and lungs’ . . . of our liberties, without which ‘the body must die.’” Haymond, 139 S. Ct. at 2375 (quoting Letter from Clarendon to W. Pym (Jan. 27, 1766), in 1 Papers of John Adams 169 (R. Taylor ed. 1977)). Complex surgery on one part of the body, however, can throw another part out of alignment. Similar consequences often follow judicial interpretations of our constitutional guarantees. For instance, consider a defendant 7 on trial for murder. The jury finds him not guilty. But the prosecution remains convinced the jury got it wrong. It brought forth a mountain of evidence that proved guilt beyond a reasonable doubt and wants to appeal. Unlike a group of laypersons, a panel of jurists, far more learned and wiser, will unquestionably find for the prosecution. Can the government appeal? Of course not, any first-year law student will answer, because of the Double Jeopardy Clause of the Fifth Amendment. Now suppose the defendant is tried for first-degree murder. The defendant acknowledges he is the killer, but the jury finds that he did not act with malice aforethought, and returns a not guilty verdict. Wait, argues the government, all the elements for an uncharged lesser crime are found in the record. So the prosecution appeals and asks those same wise judges to simply find the defendant guilty of another crime. No again, answers the student. Or perhaps the jury just can’t decide one way or another. Nine say that he definitely did it; three say that there’s no way. Like a low inside curve, can a judge make the call that decides the matter? No, because the jury verdict must be unanimous, a point recently steadied by the Supreme Court. Ramos, 140 S. Ct. at 1395. What about a defendant acquitted over an “erroneous addition of a statutory element”? Evans v. Michigan, 568 U.S. 313 , 316 (2013) (emphasis added). Can the government appeal? No, because “our cases have defined an acquittal to encompass any ruling that the prosecution’s proof is insufficient to establish criminal liability for an offense,” even if that purported insufficiency turns on an extraneous element of the offense. Id. at 318 . Indeed, an acquittal must stand even if “predicated upon a clear misunderstanding of what facts the 8 [prosecution] needed to prove under [governing] law,” without regard to “whether the court’s decision flowed from an incorrect antecedent ruling of law,” and even when “the product of an erroneous interpretation of governing legal principles.” Id. at 320 (internal quotation marks omitted). Try another: suppose after the defendant is convicted it becomes clear that the prosecution charged and proved less than every essential element of the offense. No problem, says the government, most of the elements were proven. And a guilty verdict that “omits an element of the offense,” the Supreme Court has concluded, “does not necessarily render a criminal trial fundamentally unfair.” Neder, 527 U.S. at 9 . After all, it would be awfully burdensome to retry the case just to prove what everyone seemingly already knows. But this time, the government notes, there’s a catch: there is no evidence in the record that could prove the missing element. There is other reliable proof, however, outside the trial record that establishes the unproven portion of the crime.3 Can a court consider this material—information everyone agrees the jury never saw—and then find the defendant guilty beyond a reasonable doubt? Well, the answer is complex. In the past, tests have weighed cardinal constitutional guarantees against judicial efficiency and the chance of success on retrial. See id. at 15 (“We do not think the Sixth Amendment requires 3 Perhaps, for example, the evidence was suppressed. Or the parties stipulated to bar its introduction. Maybe the prosecution did not choose to offer the evidence. Maybe none of the parties, or the court, thought the evidence was relevant. Whatever the reason, the result is the same: the jury never saw it. 9 us to veer away from settled precedent” to grant “[r]eversal without any consideration of the effect of the error upon the verdict[.]”). More recently, the Supreme Court recoiled at even the suggestion of such a balancing test. See Ramos, 140 S. Ct. at 1402 (“When the American people chose to enshrine [the Sixth Amendment] in the Constitution, they weren’t suggesting fruitful topics for future cost-benefit analysis.”). All of which brings us to Malik Nasir. II. THE DOCTRINE OF PLAIN ERROR REVIEW There is no disagreement about the road leading to this case. In Rehaif v. United States, the Supreme Court held “that the Government must prove that a defendant charged with violating [18 U.S.C.] § 922(g) knew both that he possessed a firearm and that he belonged to the relevant class of persons barred from possessing a firearm.” In re Sampson, 954 F.3d 159 , 161 (3d Cir. 2019) (per curiam) (citing Rehaif v. United States, 139 S. Ct. 2191 , 2200 (2019)). But Nasir’s indictment did not allege,4 and the Government did not prove, that Nasir knew about his prohibited status.5 Those errors are 4 Count Three of the indictment charged that Nasir “did knowingly possess in and affecting interstate and foreign commerce, firearms . . . after having been convicted of a crime punishable by imprisonment for a term exceeding one year, in the United States District Court for the Eastern District of Virginia, in violation of Title 18, United States Code, Sections 922(g)(1) and 924(a)(2).” (App. at 40–41.) 5 The District Court instructed the jury that “in order to find the defendant guilty of [ 18 U.S.C. § 922 (g)], you must find that the government proved each of the following three 10 unsurprising since, before Rehaif, “every single Court of Appeals” relied on the same “long-established interpretation” attributed to 18 U.S.C.§ 922(g) “in thousands of cases for more than 30 years.” Rehaif, 139 S. Ct. at 2201 (Alito, J., dissenting). But it was still erroneous and, since Rehaif arrived while Nasir’s direct appeal remained pending, “we apply [Rehaif] retroactively.” Johnson v. United States, 520 U.S. 461 , 467 (1997). That, one might assume, is the end of the story. Since the jury did not decide a necessary element of § 922(g), Nasir could not have received the guarantees of the Fifth and Sixth Amendments as originally understood. See Sullivan, 508 U.S. at 277–78. Not so, owing to the ever-expanding discretion afforded courts under the plain error doctrine. See, e.g., United States v. Maez, 960 F.3d 949 , 956 (7th Cir. 2020) (explaining that under Johnson, courts are to apply plain-error review to changes in constitutional law after conviction).6 elements beyond a reasonable doubt: First, that the defendant has been convicted of a felony, that is, a crime punishable by imprisonment for a term exceeding one year; Second, that after this conviction, the defendant knowingly possessed the firearm described in Count Three of the Indictment; and Third, that the defendant’s possession was in or affecting interstate or foreign commerce.” (App. at 615–16.) 6 But see Rehaif, 139 S. Ct. at 2201, 2213 (Alito, J., dissenting) (“A great many convictions will be subject to challenge, threatening the release or retrial of dangerous individuals whose cases fall outside the bounds of harmless-error review,” and “[t]hose for whom direct review has not ended will likely be entitled to a new trial.” (emphasis added)). 11 A. The Original Understanding of Plain Error Review The current authority of a federal appellate court to notice unpreserved error grew from the early practices of the Supreme Court. By the late nineteenth century, the Court’s general rule confining review “to a discussion of the errors stated” still permitted the Court, “at its discretion, [to] notice any other errors appearing in the record.” 78 U.S. (11 Wall.) x (1871) (adopting Sup. Ct. R. 21 (amended 81 U.S. (14 Wall.) xi, xii (1872), repealed 1939)). In 1874, the Court cabined that discretion and coined the now familiar “plain error” doctrine. See Sup. Ct. R. 21 § 8, 16 (1874) (“Without such an assignment of errors, counsel will not be heard, except at the request of the court, and errors not assigned according to this rule will be disregarded, though the court, at its option, may notice a plain error not assigned.”); see O’Neil v. Vermont, 144 U.S. 323 , 365 (1892) (Field, J., dissenting) (explaining “[t]he right of the court to consider [an] alleged error of its own motion is within its authority under the [plain error] rule”). As Justice Field explained, the plain error rule focused on mistakes “affecting the liberty of the citizen.” Id. at 360 . Using that authority, the Court applied the plain error rule to invalidate a constitutionally infirm conviction. Wiborg v. United States, 163 U.S. 632 , 658 (1896). In Wiborg, the Court spoke of the judicial “liberty” to review questions “not properly raised” if “a plain error was committed in a matter so absolutely vital to defendants.” Id. The Court reaffirmed that perspective in Clyatt v. United States, holding that Wiborg “justifies us in examining the question in case a plain error has been committed in a matter so vital to the defendant.” 197 U.S. 207 , 221–22 (1905). See also Crawford v. United States, 212 12 U.S. 183 , 194 (1909) (“[Courts] will, in the exercise of a sound discretion, sometimes notice error in the trial of a criminal case, although the question was not properly raised at the trial by objection and exception.”); Brasfield v. United States, 272 U.S. 448 , 450 (1926) (“[F]ailure of petitioners’ counsel to particularize an exception to the court’s inquiry does not preclude this Court from correcting the error.”). And this focus on issues “vital” to the defendant flows directly from the guarantees of the Constitution. Those commitments make the plain error rule “not a rigid one,” and courts have had “less reluctance to act under it when rights are asserted which are of such high character as to find expression and sanction in the Constitution or Bill of Rights.” Weems v. United States, 217 U.S. 349 , 362 (1910). The plain error rule, as first applied by the Supreme Court, recognizes “[t]he right of trial by Jury is a fundamental law, made sacred by the Constitution,” and enjoyed by all persons before the Founding. Vanhorne’s Lessee v. Dorrance, 2 Dall. 304 , 309 (Patterson, Circuit Justice, C.C.D.Pa.1795) (discussing the language of the 1790 Constitution of the Commonwealth of Pennsylvania mirroring the Sixth Amendment). Jury trials are a firewall against a process that would devalue natural rights, unsuitable for sacrifice on the altar of efficiency. But though conceived as a reminder of the highest principles of ordered liberty, the plain error doctrine pivoted in United States v. Atkinson, 297 U.S. 157 (1936). Departing from its prior focus on “vital” errors impacting foundational rights, Atkinson turned to concerns about the integrity of judicial proceedings. This new theory of plain error produced an oft-cited principle: “In exceptional circumstances, especially in criminal cases, appellate courts, in the public interest, may, of their own motion, notice errors to which no exception has been 13 taken, if the errors are obvious, or if they otherwise seriously affect the fairness, integrity, or public reputation of judicial proceedings.” Id. at 160 . B. The Text of Rule 52(b) The turn did not take. Rule 52(b) codified the plain error doctrine in 1944, choosing fundamental rights over structural anxieties by shedding the baggage of Atkinson in favor of a straightforward definition: “[a] plain error that affects substantial rights may be considered even though it was not brought to the court’s attention.” Fed. R. Crim. P. 52(b). It is, of course, “the text of the Rule that controls.” Krupski v. Costa Crociere S.p.A., 560 U.S. 538 , 557 (2010) (Scalia, J., concurring in part). Rule 52(b) limits the power to notice unpreserved errors to only those affecting “substantial rights.” That language traces straight back to Wiborg. See, e.g., Storgard v. France & Canada S.S. Corp., 263 F. 545 , 546 (2d Cir. 1920) (“[A]ppellate courts may consider plain errors, not excepted to nor assigned, though this is rarely done except in criminal cases” that impact “substantial rights.”) (citing Oppenheim v. United States, 241 F. 625 , 628 (2d Cir. 1917) (citing Wiborg and Crawford)); McCormick v. United States, 9 F.2d 237 , 240 (8th Cir. 1925) (“The substantial rights of defendants in criminal cases have always been amply protected. . . . [W]here plain error has been committed in a matter vital to defendants, . . . it is considered.”) (citing Wiborg). Against that backdrop, there is little reason to conclude that Rule 52(b) disregarded the traditional meaning of the plain error rule. See Antonin Scalia & Bryan Garner, Reading Law: The Interpretation of Legal Texts 318 (2012) (explaining the canon of interpretation that “statutes will not be interpreted as changing the common law unless they effect 14 the change with clarity”). And while “not authoritative,” Black v. United States, 561 U.S. 465 , 475 (2010) (Scalia, J., concurring in part and concurring in the judgment), the commentary provided by the Advisory Committee confirms that is the best reading of the rule. See Fed. R. Crim. P. 52 advisory committee’s note to subsection (b) (“Th[e] [plain error] rule is a restatement of existing law[.]”) (citing Wiborg, 163 U.S. at 658 ); see also Krupski, 560 U.S. at 557 (Scalia, J., concurring in part and concurring in the judgment) (“The Advisory Committee’s insights into the proper interpretation of a Rule’s text are useful to the same extent as any scholarly commentary.”). C. The Olano Framework Despite all of this, the Court would later state that “the ‘standard laid down in United States v. Atkinson [was] codified in [Rule] 52(b).’” United States v. Olano, 507 U.S. 725 , 736 (1993). Olano provides a four-pronged inquiry that remains our standard today. Courts may provide remedies under Rule 52(b) only if (1) there is an “error[,]” (2) the error is “plain[,]” and (3) the plain error “affect[s] substantial rights.” Id. at 732– 34; see also Johnson, 520 U.S. at 466–67 (1997). Satisfying all three prongs creates discretion to (4) “correct a plain forfeited error affecting substantial rights if the error ‘seriously affect[s] the fairness, integrity or public reputation of judicial proceedings.’” Olano, 507 U.S. at 736 (citing Atkinson, 297 U.S. at 160 ). So now, “a plain error affecting substantial rights does not, without more, satisfy the Atkinson standard, for otherwise the discretion afforded by Rule 52(b) would be illusory.” Id. at 736–37. 15  Recent applications of Rule 52(b) have focused on its discretionary character. See Johnson, 520 U.S. at 469–70 (“When the first three parts of Olano are satisfied, an appellate court must then determine whether the forfeited error ‘seriously affect[s] the fairness, integrity or public reputation of judicial proceedings’ before it may exercise its discretion to correct the error.”) (citing Olano, 507 U.S. at 736 ). These cases make clear that any “per se approach to plain-error review is flawed,” United States v. Young, 470 U.S. 1 , 16 n.14 (1985), because “[t]he fourth prong is meant to be applied on a case-specific and fact-intensive basis.” Puckett v. United States, 556 U.S. 129 , 142 (2009). That, of course, is nothing new, as the original application of plain error always assumed searching scrutiny. See Weems, 217 U.S. at 362 ; Crawford, 212 U.S. at 194; Clyatt, 197 U.S. at 221–22; Wiborg, 163 U.S. at 658 . But the Court expressly tied that probing inquiry to violations of natural, substantial rights “of such high character as to find expression and sanction in the Constitution or Bill of Rights.” Weems, 217 U.S. at 362 . That, in my view, is the best reading of Olano, one that harmonizes the guarantees of the Sixth Amendment and the tradition of noticing errors that, though unpreserved, uniquely threaten fundamental rights. Not one that licenses endless tradeoffs to efficiency. Rather, as the Supreme Court recently cautioned, while “[t]here may be instances where countervailing factors satisfy the court of appeals that the fairness, integrity, and public reputation of the proceedings will be preserved absent correction,” we must perform a “searching” inquiry. Rosales-Mireles v. United States, 138 S. Ct. 1897 , 1909 (2018) (emphasis added). Searching should, as always, begin with the original public understanding of the right in question. Looking to that history, I conclude that 16 allowing an appellate court to find facts and inferences outside the record to rescue a conviction that all agree lacked an essential element of proof usurps the role of the jury and therefore cannot be a countervailing factor under Olano. Put simply, it is difficult to imagine a countervailing consideration more fundamental than the fundamental right to a trial by jury secured by the Constitution. III. CONTRACTING PLAIN ERROR REVIEW IS INCONSISTENT WITH HISTORY AND TRADITION In many respects, we have already traveled far from the guarantees of the Sixth Amendment to the conclusion that failing to submit every element of a crime to the jury does not “seriously affect the fairness, integrity, or public reputation of judicial proceedings.” Johnson, 520 U.S. at 469–70; see also United States v. Cotton, 535 U.S. 625 , 632–33 (2002) (“As in Johnson, we need not resolve whether respondents satisfy this element of the plain-error inquiry, because even assuming respondents’ substantial rights were affected, the error did not seriously affect the fairness, integrity, or public reputation of judicial proceedings.”) (citation omitted); Neder, 527 U.S. at 9 (“[A]n instruction that omits an element of the offense does not necessarily render a criminal trial fundamentally unfair or an unreliable vehicle for determining guilt or innocence.”). Now, even under harmless-error review, an appellate court is free to step into the role of the jury and peruse the record for facts supporting the missing element of a crime. Id. at 17 . At least, the court may step in for now, so long as those facts are “overwhelming,” “uncontroverted,” and “[o]n [the] record.” Johnson, 520 U.S. at 470 (internal quotation marks omitted); see also Neder, 520 U.S. at 16–17 (upholding conviction relying on “overwhelming record evidence”); Cotton, 535 U.S. 17 at 633 (finding no plain error where record evidence was “overwhelming” and “essentially uncontroverted”). So while “we do not know . . . how many elements can be taken away from the jury with impunity, so long as appellate judges are persuaded that the defendant is surely guilty,” we know we would be free to affirm Nasir’s conviction looking solely to evidence in the record. Neder, 527 U.S. at 33 (Scalia, J., concurring in part and dissenting in part). But we have no such evidence to reach for. To uphold Nasir’s conviction, we must supplement the evidentiary record with information never presented to the jury. “The most [we] can conclude is that a jury would surely have found petitioner guilty beyond a reasonable doubt—not that the jury’s actual finding of guilty beyond a reasonable doubt would surely not have been different absent the constitutional error.” Sullivan, 508 U.S. at 280. I am doubtful that the Sixth Amendment was first understood to provide courts the power “to hypothesize a guilty verdict that was never in fact rendered.” Id. at 279. Some might find it tempting to glance outside the record for proof, perhaps even compelling proof, that Nasir knew he was a felon. But that is just the sort of temptation that informed a “healthy suspicion” of government power and drove the demand for written confirmation of our most sacred rights. Neder, 527 U.S. at 32 (Scalia, J., concurring in part and dissenting in part); see also 3 J. Story, Commentaries on the Constitution of the United States § 1774, at 653 (1833) (“[Protection] against a spirit of oppression and tyranny on the part of rulers, and against a spirit of violence and vindictiveness on the part of the people” demands “the severe control of courts of justice, and by the firm and impartial verdict of a jury sworn to do right and guided solely by legal evidence and a sense of duty. In such a course there is a double security against the prejudices of 18 judges, who may partake of the wishes and opinions of the government, and against the passions of the multitude, who may demand their victim with a clamorous precipitancy.”); cf. Duncan, 391 U.S. at 160 (“So-called petty offenses were tried without juries both in England and in the Colonies and have always been held to be exempt from the otherwise comprehensive language of the Sixth Amendment’s jury trial provisions. There is no substantial evidence that the Framers intended to depart from this established common-law practice.”). This history is reason alone to decline a fresh contraction of the plain error doctrine. The theory of plain error review exists, as must all laws, as a validation of our natural and fundamental rights. It is best imagined as a shield against arbitrary expansions of government, not a sword of efficiency striking at the very impediments to easier oppression demanded by the Framers, Ratifiers, and People. Failing to notice error here would necessarily contravene the original understanding of the Sixth Amendment and, therefore, necessarily flout the rule of Olano prohibiting courts to ignore errors that “seriously affect the fairness, integrity or public reputation of judicial proceedings.” Olano, 507 U.S. at 736 . Many courts have held differently. Some say it is of no moment that the government did not prove knowledge because it is obvious the defendant knew he was a felon. Reliable records tell us so, they say, and disregarding what a jury did not see would jeopardize the fairness, integrity, and reputation of the proceedings. See, e.g., United States v. Miller, 954 F.3d 551 , 558 (2d Cir. 2020). Others conclude that “because convicted felons typically know they’re convicted felons,” any error is “almost always harmless.” United States v. Lavalais, 19  960 F.3d 180 , 188 (5th Cir. 2020); see also United States v. Gary, 963 F.3d 420 , 423 (4th Cir. 2020) (Wilkinson, J., concurring) (“[T]he vast majority of defendants who will seek to take advantage of a structural Rehaif error are perfectly aware of their felony status. Felony status is simply not the kind of thing that one forgets.”). Still others find post-Rehaif extra-record review to be a natural evolution to reviewing documents outside the record at sentencing. See United States v. Reed, 941 F.3d 1018 , 1021 (11th Cir. 2019) (quoting United States v. Vonn, 535 U.S. 55 , 59 (2002)). Perhaps. But I do not read these post-Rehaif cases to proceed from the common law tradition of plain error review and, as a corollary, the original understanding of the Sixth Amendment. I find no evidence that the guarantees enumerated in the Bill of Rights are measured for modern efficiency. To the contrary, our Framers expected these rights would protect us all from encroachment by the government they hesitantly accepted. That fear explains why, “[w]hen our more immediate ancestors removed to America, they brought this great privilege with them, as their birth-right and inheritance, as a part of that admirable common law, which had fenced round, and interposed barriers on every side against the approaches of arbitrary power.” 3 J. Story, Commentaries on the Constitution of the United States § 1773, at 652–53 (1833); see also Thompson v. Utah, 170 U.S. 343 , 350 (1898) (“The trial per pais, or by a jury of one’s country, is justly esteemed one of the principal excellencies of our constitution; for what greater security can any person have in his life, liberty, or estate than to be sure of the being devested of nor injured in any of these without the sense and verdict of twelve honest and impartial men of his neighborhood?” (quoting Juries, 3 Matthew Bacon, A New Abridgment of the Law (1736)). Put simply: “If you’re 20 charged with a crime, the Sixth Amendment guarantees you the right to a jury trial. From this, it follows that the prosecutor must prove to a jury all of the facts legally necessary to support your term of incarceration.” Hester v. United States, 139 S. Ct. 509 , 509 (2019) (Gorsuch, J., dissenting). For that reason, I prefer the certainty of the “great rights” Madison captured in the Constitution, including “trial by jury, freedom of the press, [and] liberty of conscience.” 1 Annals of Cong. 453 (1789) (Joseph Gales ed., 1834). Rather than see them eroded, I find “it is proper that every Government should be disarmed of powers which trench upon those particular rights.” Id. at 458 . While that differs from the conclusions of other courts, we should recall that “[t]hose who wrote our constitution[] knew from history and experience that it was necessary to protect against unfounded criminal charges . . . and against judges too responsive to the voice of higher authority.” Duncan, 391 U.S. at 156 . IV. CONCLUSION I readily acknowledge that retrying defendants like Nasir might end up with juries returning the same verdict of guilt. But isn’t that the point? Like Justice Scalia, and Blackstone long before him, I bear deep reservations about any holding that “scorn[s]” our “formal requirements . . . when they stand in the way of expediency.” Neder, 527 U.S. at 39–40 (citing 4 W. Blackstone, Commentaries *350 (“[H]owever convenient [intrusions on the jury right] may appear at first, (as, doubtless, all arbitrary powers, well executed, are the most convenient,) yet let it be again remembered that delays and little inconveniences in the forms of justice are the price that all free nations must pay for their liberty in more substantial 21 matters[.]”). Pillars of liberty are rarely toppled, but sanded down into forms unrecognizable to their creator. The right to be judged by impartial peers under the due process of law stands as an antagonist against such erosion, and “[s]o long . . . as this palladium remains sacred and inviolable, the liberties of a free government cannot wholly fall.” 3 J. Story, supra § 1774, at 653 (citing 4 Blackstone Commentaries at *349–50). For all these reasons, I conclude that “[i]n the end, the best anyone can seem to muster . . . is that, if we dared to admit in his case what we all know to be true about the Sixth Amendment, we might have to say the same in some others.” Ramos, 140 S. Ct. at 1408 (plurality opinion). I therefore concur. 22 PORTER, Circuit Judge, joined by SMITH, Chief Judge, CHAGARES, HARDIMAN, SHWARTZ, BIBAS, and PHIPPS, Circuit Judges, concurring in part and dissenting in part. I concur with Sections I and II.D of the majority opin- ion. But I depart from the majority’s plain-error discussion in Section II.E because it is profoundly mistaken, it dismisses the collective wisdom of nearly every other circuit court, and— ironically—it derogates the fairness, integrity, and public rep- utation of judicial proceedings. After reviewing the entire rec- ord, I would affirm Malik Nasir’s conviction rather than re- mand it for a pointless retrial. I. ADDITIONAL BACKGROUND A. Nasir pleaded guilty to felony charges on three separate occasions and actually served over seven years’ imprisonment On September 6, 2000, Nasir pleaded guilty to attempt- ing to possess cocaine with intent to distribute. As a result of his guilty plea and felony conviction, Nasir was sentenced to seven years’ imprisonment. After serving one year in prison, his sentence was suspended, and he was placed on supervised probation. On June 21, 2001, Nasir pleaded guilty to possession of cocaine with intent to distribute. As a result of his guilty plea and felony conviction, Nasir was sentenced to ten years’ and thirty days’ imprisonment. After serving eighteen months in prison, his sentence was suspended and he was placed on su- pervised probation. 1  On June 20, 2007, Nasir pleaded guilty to possession of a firearm by a convicted felon in violation of 18 U.S.C. § 922 (g)(1). As a result of his guilty plea and felony convic- tion, Nasir was sentenced to eighty-four months’ imprison- ment. He actually served five and one-half years of that sen- tence before being released on December 14, 2012. B. Nasir stipulated to his prior felony conviction and did not make a scienter objection at trial In 2015, Nasir was indicted for violating the felon-in- possession statute, together with several drug-related charges. At his 2017 trial, Nasir stipulated that he had been “convicted of a felony crime punishable by imprisonment for a term ex- ceeding one year, in the United States District Court for the Eastern District of Virginia.” S.A. 21. Although Nasir’s stipu- lation did not specify the prior felony conviction, it was for possession of a firearm by a convicted felon in violation of 18 U.S.C. § 922 (g)(1)—the same crime for which he was being tried. Nasir’s stipulation prevented the government from intro- ducing evidence to prove the nature and circumstances of his prior felony conviction. See Old Chief v. United States, 519 U.S. 172 , 174–75 (1997). Under the law at the time of Nasir’s trial, the govern- ment adduced sufficient evidence to secure a conviction under § 922(g)(1) and the district court properly instructed the jury on the elements of that crime. Nasir did not object to the district court’s jury instruction or to the sufficiency of the govern- ment’s evidence on the § 922(g)(1) charge. But while his ap- peal was pending the Supreme Court decided Rehaif v. United States, 139 S. Ct. 2191 (2019), holding that in order to secure a conviction under § 922(g), the government must prove that the defendant “knew he belonged to the relevant category of 2 persons barred from possessing a firearm.” Id. at 2200. Nasir then supplemented his briefing by adding new arguments based on Rehaif. II. NASIR CANNOT SATISFY OLANO PRONG FOUR, SO HIS CONVICTION SHOULD BE AFFIRMED A. The purpose of plain-error review The majority duly notes that because Nasir did not ob- ject to the sufficiency of the evidence on the knowledge-of- status element, we review for plain error. Maj. Op. 27. But the majority fails to consider the reason for plain-error review and how that reason informs our decision. Federal Rule of Criminal Procedure 52(b) exists to promote compliance with claim- presentation rules. When a defendant forfeits an issue by fail- ing to timely object, we have discretion to correct the plain er- ror. But that discretion is bounded by the four factors discussed in United States v. Olano, 507 U.S. 725 , 732–36 (1993), par- ticularly the prong-four focus on the fairness, integrity, and public reputation of judicial proceedings. The link between forfeiture and plain-error review is relevant here because Nasir failed to raise a knowledge-of-sta- tus objection at his trial. True, the Supreme Court did not change the rule until two years later when it decided Rehaif. But even if a solid wall of circuit authority makes objection at trial apparently futile, Rule 52(b) applies when the source of plain error is a supervening decision. Johnson v. United States, 520 U.S. 461 , 468 (1997). Contra United States v. Keys, 95 F.3d 874 , 878 (9th Cir. 1996) (Rule 52(a), rather than Rule 52(b), governs appellate review of unpreserved error when de- fendant “faced with a solid wall of circuit authority” at trial), vacated, 520 U.S. 1226 (1997). 3  Contrary to the majority’s suggestion, Maj. Op. 28–30, the scienter issue was hardly a secret at the time of Nasir’s trial. The Supreme Court highlighted the constitutional importance of mens rea in Staples v. United States, 511 U.S. 600 , 619–20 (1994) (government required to prove that defendant knew that the features of his AR-15 rifle brought it within the scope of machine-gun provision of National Firearms Act), and United States v. X-Citement Video, Inc., 513 U.S. 64 , 78 (1994) (in prosecution under Protection of Children Against Sexual Exploitation Act, government required to prove that defendant knew he was sending or receiving pictures of minors engaged in sexually explicit conduct). In 1995, a divided Fourth Circuit held that the government need not prove that the defendant in a § 922(g)(1) prosecution had the requisite scienter regarding his felony status. United States v. Langley, 62 F.3d 602 (4th Cir. 1995) (en banc). Subsequently, the scienter issue in § 922(g) cases continued to percolate in courts throughout the country. See, e.g., United States v. Games-Perez, 695 F.3d 1104 , 1116–24 (10th Cir. 2012) (Gorsuch, J., dissenting from denial of rehearing en banc); United States v. Games-Perez, 667 F.3d 1136 , 1140–42 (10th Cir. 2012); United States v. Butler, 637 F.3d 519 , 523–25 (5th Cir. 2011); United States v. Olender, 338 F.3d 629 , 637 (6th Cir. 2003); United States v. Enslin, 327 F.3d 788 , 798–99 (9th Cir. 2003); United States v. Wilson, 159 F.3d 280 , 293–96 (7th Cir. 1998) (Posner, J., dis- senting). In our circuit, a district court anticipated Rehaif by a decade, holding that in a § 922(g)(1) prosecution the govern- ment must prove that the defendant knew of his felon status. United States v. Kitsch, No. 03-594-01, 2008 WL 2971548 , at *7 (E.D. Pa. Aug. 1, 2008). And in prosecutions for the closely related charge of aiding and abetting a violation of § 922(g)(1), 4 we have long required the government to prove beyond a rea- sonable doubt that the defendant knew the possessor’s status as a felon. United States v. Xavier, 2 F.3d 1281 , 1286–87 (3d Cir. 1993). Even though a timely scienter-based objection would likely have been overruled in 2017, the objection itself could have prompted the government to supplement the record with additional evidence of Nasir’s mens rea. See Pfeifer v. Jones & Laughlin Steel Corp., 678 F.2d 453 , 457 n.1 (3d Cir. 1982) (contemporaneous objection rule “affords an opportunity for correction and avoidance in the trial court in various ways: it gives the adversary the opportunity either to avoid the chal- lenged action or to present a reasoned defense of the trial court’s action; and it provides the trial court with the alterna- tive of altering or modifying a decision or of ordering a more fully developed record for review”), judgment vacated on other grounds, 462 U.S. 523 (1983). But Nasir—unlike Rehaif—did not preserve his scienter-based objection, so he deprived the government and trial court of these opportunities. B. The nature of plain-error review Rule 52(b) gives us discretion to correct plain error in such cases, but the rule is “permissive, not mandatory.” Olano, 507 U.S. at 735 . And our discretionary authority to remedy a forfeited error is “strictly circumscribed,” Puckett v. United States, 556 U.S. 129 , 134 (2009), though not as the majority appears to believe. The majority asserts that we have only “a degree of discretion in determining whether to correct [plain] error,” which seems to suggest a presumption in favor of error- correction and that our discretion to ignore plain error is quite narrow. Maj. Op. 27. 5  The majority’s parsimonious view of our Rule 52(b) discretion is contrary to Supreme Court precedent. We are to correct plain errors “sparingly,” Jones v. United States, 527 U.S. 373 , 389 (1999), and only in “exceptional circumstances,” United States v. Atkinson, 297 U.S. 157 , 160 (1936), where it is necessary to set aside “particularly egregious errors,” United States v. Young, 470 U.S. 1 , 15 (1985) (internal quotation marks omitted) (quoting United States v. Frady, 456 U.S. 152 , 163 (1982)). Meeting all four prongs of the plain-error standard “is difficult, ‘as it should be.’” Puckett, 556 U.S. at 135 (quot- ing United States v. Dominguez Benitez, 542 U.S. 74 , 83 n.9 (2004)). That is particularly true when, as here, curing the plain error would require the district court to conduct a burdensome jury retrial. Rosales-Mireles v. United States, 138 S. Ct. 1897 , 1909 (2018). The reviewing court’s exercise of prong-four discretion is an independent barrier to relief on a forfeited claim of error. Even “a plain error affecting substantial rights does not, with- out more, satisfy the Atkinson standard, for otherwise the dis- cretion afforded by Rule 52(b) would be illusory.” Olano, 507 U.S. at 737 . Regrettably, we have sometimes conflated prongs three and four with little to no separate prong-four analysis. See United States v. Gaydos, 108 F.3d 505 , 509 (3d Cir. 1997) (suggesting, without any prong-four analysis, that the plain er- ror automatically satisfied prong four); Xavier, 2 F.3d at 1287 (same). This case affords a rare opportunity for the en banc Court to disavow such imprecision and fine-tune its approach to plain-error review. Alas, the majority exacerbates the prob- lem by declaring that the plain error in Nasir’s case derogated his substantial rights thus satisfying Olano step four. Maj. Op. 62 (citing Gaydos, 108 F.3d at 509 ). Rather than conduct “a 6 case-specific and fact-intensive” review in light of the entire record, Puckett, 556 U.S. at 142 , the majority simply assumes that plain error of an undefined “magnitude” categorically re- quires correction at Olano prong four. Maj. Op. 62. C. Plain-error review requires consideration of the entire record Casting aside the case-specific and fact-intensive ap- proach required by Puckett, the majority asserts that “constitu- tional norms” require error-correction because the Supreme Court’s decision in Rehaif retroactively created due process concerns. Maj. Op. 62. But framing the plain error as a due- process violation does not automatically satisfy Olano prong three or four. See United States v. Marcus, 560 U.S. 258 , 264– 66 (2010). That is because even constitutional rights “may be forfeited in criminal as well as civil cases by the failure to make timely assertion of the right before a tribunal having jurisdic- tion to determine it.” Olano, 507 U.S. at 731 (internal quotation marks omitted) (quoting Yakus v. United States, 321 U.S. 414 , 444 (1944)). So a defendant’s failure to object at trial, even though the error was not plain at the time, “may well count against the grant of Rule 52(b) relief.” Henderson v. United States, 568 U.S. 266 , 278–79 (2013). The Court in Johnson held only that an error that was not plainly incorrect at the time of trial becomes plain when the law is subsequently clarified. Johnson, 520 U.S. at 468 . That is, the timing question concerned the “plainness” of the error, which relates only to Olano prong two. See Henderson, 568 U.S. at 279 (time-of-review rule adopted in Johnson and Henderson applies specifically to the second part of the four- part Olano test). The majority’s insistence that our prong-four analysis is likewise limited to the time of trial (as memorialized 7 in the trial record) is unwarranted and finds no support in Johnson. Indeed, having found that the error was plain, the Court in Johnson assumed without deciding that Olano prong three was satisfied and denied relief under prong four because the error did not “seriously affect[] the fairness, integrity or public reputation of judicial proceedings.” Johnson, 520 U.S. at 469– 70 (internal quotation marks omitted) (quoting Olano, 507 U.S. at 736 ). Two aspects of the Court’s discussion are relevant here. First, the Court itself—and not the jury—found that the record contained enough evidence on materiality that no rea- sonable juror could have decided the materiality question1 in any other way. Id. at 470; see also United States v. Johnson, 899 F.3d 191 , 200 (3d Cir. 2018) (finding the trial record con- tained sufficient evidence to support defendant’s conviction and declining to cure plain error at prong four, even though the jury was not instructed to find, and did not find, a required el- ement). Second, in making that finding the Court did not confine its review to information available only at the time of trial. Ra- ther, it noted that “[m]ateriality was essentially uncontroverted at trial and has remained so on appeal.” Johnson, 520 U.S. at 470 (emphasis added) (footnote omitted). Reviewing the case under the prong-four standard, the Court considered whether petitioner made a plausible showing2—not just at trial but 1 The plain error in Johnson concerned the trial court’s failure to submit materiality to the jury, as subsequently required in United States v. Gaudin, 515 U.S. 506 (1995). Johnson, 520 U.S. at 464 . 2 We have also previously used a “no-plausible-argument” or “no-plausible-explanation” test in deciding plain-error cases at 8 afterwards, before the Eleventh Circuit or the Supreme Court—that the false statement for which she was convicted was not material. Id. Satisfied that she had not, the Court af- firmed the court of appeals’ exercise of its discretion to decline to correct the plain error. So while the “plainness” of an error (prong two) is pegged to the time of trial, the broader question whether the plain error seriously affects the fairness, integrity, and public reputation of judicial proceedings (prong four) has a longer time horizon extending throughout the appeal process. See Henderson, 568 U.S. at 275 (the reviewing court examines Olano’s third and fourth criteria by “looking at the circum- stances that now are,” i.e., at the time of the appeal rather than by looking back to the time of trial). The majority attempts to narrow the discretion provided by Rule 52(b) by ignoring its expansive text and cabining its temporal scope. Throughout its opinion, the majority insists that the discretion afforded by Rule 52(b) must be restricted to the time of the trial itself and to facts in the trial record. This is necessary, the majority warns, to avoid trampling on Fifth and Sixth Amendment rights in violation of In re Winship, 397 U.S. 358 (1970). Maj. Op. 32–33. The majority misapprehends the nature and purpose of plain-error review, particularly at prong four. We do not pur- port to “find facts” in order to overcome a deficiency in the evidence and on that basis pronounce the defendant’s convic- tion while relieving the government of its burden. Rather, as is clear from the entire line of plain-error cases before and after Olano, there is a material difference between our remedial prong four. See, e.g., United States v. Greenspan, 923 F.3d 138 , 154–56 (3d Cir. 2019); United States v. W. Indies Transp., Inc., 127 F.3d 299 , 306 (3d Cir. 1997). 9 discretion under Rule 52(b) and the jury’s factfinding role at trial. At prong four, we answer a question that no jury could ever appropriately entertain: whether, considering the entire record, reasonable observers would conclude that declining to correct the plain error creates a miscarriage of justice or would seriously affect the fairness, integrity, and public reputation of judicial proceedings generally. Conversely, remanding for retrial on an uncontestable element may be “[t]he real threat” to fairness and undermine the reputation of judicial proceedings—a powerful truism that the majority does not acknowledge. United States v. Cotton, 535 U.S. 625 , 634 (2002); see also Dominguez Benitez, 542 U.S. at 82 (plain-error review should enforce Rule 52(b)’s pol- icy of reducing “wasteful reversals”). The majority’s misconception of plain-error review in- fects its entire discussion of the record that we review under Rule 52(b). Because the majority regards plain-error review as a kind of extension of the jury trial rather than a discretionary act tethered to Rule 51(b)’s forfeiture rule, it fixates on Winship’s requirement of proof beyond a reasonable doubt in criminal trials. Maj. Op. 32–37.3 Were we reviewing Nasir’s conviction for sufficiency of the evidence, the majority’s scru- ples would be more persuasive. But we are merely exercising remedial discretion over a forfeited objection, so unless the 3 In response, the majority contends that what separates us is nothing less than fidelity to the “Constitution itself.” Maj. Op. 34 n.17. But the majority ignores the thrust of my criticism. In a different case the majority’s fixation on Winship would be salutary, but here it is misplaced because plain-error review is not a continuation of the jury trial. 10 majority intends to attack the constitutionality of Rule 52(b) generally, its analysis is misdirected.4 D. By limiting plain-error review to the trial rec- ord, the majority creates a per se rule requir- ing error correction We evaluate a claim of plain error “against the entire record” because “[i]t is simply not possible for an appellate court to assess the seriousness of the claimed error by any other means.” Young, 470 U.S. at 16 . This case nicely illustrates why it is “simply not possible” to perform a prong-four assessment without considering the whole record. At prong three, we re- view only the trial record to determine whether the error af- fected the outcome of the district court proceedings. See United States v. Maez, 960 F.3d 949 , 961 (7th Cir. 2020). If it did, then we move to Olano prong four. But if at prong four we continue to limit our consideration to the trial record we see only the prejudice that satisfied prong three in the first place. We cannot see—or more precisely, we pretend not to notice—Nasir’s 4 We do not “[d]isregard[] constitutional norms” in refusing to remand a case to the district court on plain-error review when the jury’s verdict was obviously correct. Maj. Op. 62. Surely the majority is not suggesting that plain-error review is inap- plicable whenever important constitutional rights are at issue; nor (I hope) is it suggesting that nearly all of our sister circuits are so unconcerned with the preservation of constitutional guarantees that they would disregard an obvious Sixth Amendment violation just for the sake of keeping a person be- hind bars. See infra at 16–17. Simply put, the majority’s ap- proach challenges the constitutionality of Rule 52(b)’s plain- error standard as explicated in Supreme Court decisions. 11 three prior felony guilty pleas5 and his seven and one-half years of imprisonment. Thus blinkered, we cannot adopt the broader, outward-looking perspective necessary to determine whether public perceptions of fairness, integrity, and the reputation of judicial proceedings require us to cure the error. The majority’s crucial move—limiting the scope of our prong-four review—is dispositive in appeals from Rehaif- infected felon-in-possession convictions where, as here, the de- fendant stipulated to his felon status. Because of Nasir’s stipu- lation, the government was precluded from adducing evidence relating to the nature and circumstances of his prior felony con- victions. Old Chief, 519 U.S. at 174–75. For the reasons 5 The majority is comfortable inferring a defendant’s knowledge-of-felon status from his prior guilty plea because “when a defendant pleads guilty, the district court must ensure that the plea is knowing and voluntary.” Maj. Op. 40. But the majority refuses to apply that same logic to Nasir, who know- ingly and voluntarily pleaded guilty to felony charges on three separate occasions. Indeed, he even pleaded guilty to a prior felon-in-possession charge. So as the majority acknowledges, when he was tried for the same offense in this case he neces- sarily knew that he was a felon. This is precisely the sort of information that should inform our discretionary judgment at prong four. See, e.g., United States v. Huntsberry, 956 F.3d 270 , 285 (5th Cir. 2020); United States v. Ward, 957 F.3d 691 , 695 (6th Cir. 2020). Nasir’s plea to a felon-in-possession charge, which is the offense embodied in the Old Chief stipu- lation, is a central reason why this case is not one where allow- ing the conviction to stand would impugn the fairness, integ- rity, or reputation of judicial proceedings. See also infra at 21- 23. 12 explained in Old Chief, shielding Nasir in that manner was ap- propriate at his jury trial. But post-trial, the unfair-prejudice and jury-misleading rationales of Federal Rule of Evidence 403 no longer obtain, which highlights the tension between Rehaif and Old Chief that Justice Alito noted in his Rehaif dis- sent. Rehaif, 139 S. Ct. at 2209 (Alito, J., dissenting). The ma- jority’s restriction of our prong-four review to the trial record effectively converts Nasir’s Old Chief stipulation from a jury- trial shield into an appellate sword preventing this Court from considering facts relating to his scienter. Allowing Nasir to deploy Old Chief offensively itself adversely affects the fairness, integrity, and public reputation of judicial proceedings. But limiting our prong-four review to the trial record is even more consequential. By short-circuiting the Olano analysis at step three, the majority predestines the result in appeals of Rehaif-infected felon-in-possession convic- tions involving an Old Chief stipulation—always in favor of error-correction. The combination of Old Chief and the major- ity’s insistence that we may consider only the trial record, even at prong four, creates a per se rule requiring remand in every such case. That is precisely the type of “flawed” approach that the Supreme Court has disapproved because it renders our prong-four discretion “illusory.” Olano, 507 U.S. at 737 ; Young, 470 U.S. at 16 n.14. Given the Supreme Court’s clear and repeated admoni- tions, the majority offers assurance that it is not advocating the adoption of a per se rule. Maj. Op. 50 n.29. But that disclaimer is meaningless; whether the majority intends to “advocate” the adoption of a per se rule, it has in fact created one. Gamely trying to demonstrate the flexibility of its per se rule, the ma- jority offers two examples “where sufficient evidence was pre- sented at trial to show that the defendant was aware of his status 13 as a felon at the time of the crime.” Id. (citing United States v. Moss, 812 F. App’x 108, 111 (4th Cir. 2020), and United States v. Velázquez-Aponte, 940 F.3d 785 , 800 (1st Cir. 2019)). Both cases are inapposite, however, because in neither did the de- fendant invoke the Old Chief bar by stipulating to his prior fel- ony conviction. Throughout its opinion, the majority discounts the im- pact of Nasir’s Old Chief stipulation. Maj. Op. 47 n.26 (“[W]e think the existence of an Old Chief stipulation has little rele- vance to the analysis . . . .”). That is a massive blind spot. Because defendants typically avail themselves of Old Chief when they have multiple or damning felony records, it should come as no surprise that a reviewing court, conducting plain-error review, will find that the fairness, integrity, or public rep- utation of judicial proceedings has not been af- fected, when considering evidence of the defend- ant’s felony status beyond just the trial record. United States v. Miller, 954 F.3d 551 , 559 n.23 (2d Cir. 2020). That is true here, as well. But by limiting our review to the trial record—which of course includes the Old Chief bar—the ma- jority makes it impossible for us to perform the required prong- four analysis. The majority has no answer to the outsized role of Old Chief in this case, except to implausibly suggest that Nasir’s stipulation did not prevent the government from introducing his knowledge-of-status at trial. Maj. Op. 50 n.29. But pre- cisely because of Nasir’s stipulation, the trial court would al- most certainly have sustained the inevitable unfair-prejudice objection because the evidence proving his felon status and 14 knowledge of status is substantially the same, or at least inex- tricably intertwined. E. The “entire record” is broader than the trial record The majority leans heavily on Johnson for its holding that we may consider only the trial record on plain-error re- view, rather than the entire record. Maj. Op. 34–35. But Johnson was not a felon-in-possession case, so the trial record was not constrained by Old Chief. As a result, the evidence supporting materiality was so “overwhelming” that petitioner had “no plausible argument” at trial or on appeal. Johnson, 520 U.S. at 470. The lack of an Old Chief stipulation is highly rel- evant to the analysis in Johnson and distinguishes it from this case. The majority’s discussion of Neder v. United States, 527 U.S. 1 (1999), is even less persuasive. Maj. Op. 35 n.18. Neder was a harmless-error case decided under Rule 52(a), not a Rule 52(b) plain-error case. 527 U.S. at 7–8. Olano step three is essentially harmless-error analysis, and as the majority itself acknowledges, all agree that it is based on the trial record. Maj. Op. 44–45 (discussing Maez). But the move from step three to step four distinguishes this and other plain-error cases from Neder, and it is at step four that we are required to evaluate the case “against entire record.” Young, 470 U.S. at 16 . The ma- jority’s reliance on Neder in support of its trial-record-only holding underscores its persistent tendency to conflate Olano prongs three and four.6 6 The majority’s emphasis on the amount of evidence in the Neder trial record is curious, considering its heavy reliance on 15  Our sister circuits understand this quite well. As the ma- jority concedes, the Second, Fifth, Sixth, Seventh, Eighth, Ninth, and Eleventh Circuits have repeatedly affirmed jury ver- dicts in § 922(g) cases and rejected arguments similar to those accepted by the majority. Miller, 954 F.3d at 560; Huntsberry, 956 F.3d at 285–87; Ward, 957 F.3d at 695; Maez, 960 F.3d at 963–64; United States v. Owens, 966 F.3d 700 , 706–07 (8th Cir. 2020); United States v. Benamor, 937 F.3d 1182 , 1188–89 (9th Cir. 2019); United States v. Reed, 941 F.3d 1018 , 1021– 22 (11th Cir. 2019). Even United States v. Medley, 972 F.3d 399 (4th Cir. 2020), which the majority enlists for support, Maj. Op. 57–58, does not explicitly foreclose consideration of matters outside the trial record when addressing forfeited Rehaif claims under the plain-error standard. Medley, 972 F.3d at 417. Medley is already an outlier; the majority would go even further and place this Court beyond the pale. At last count, 140 appellate judges and 15 district judges sitting by designation have voted to uphold a felon-in-posses- sion conviction on plain-error review of a Rehaif claim. How could so many federal judges approve the obvious violation of important Fifth Amendment and Sixth Amendment rights? The In re Winship. Maj. Op. 35 n.18. The defendant’s Sixth Amendment right is to have all evidence proven beyond a rea- sonable doubt to a jury, not simply to have the government put a surfeit of evidence into a record. Yet, applying the harmless- error standard the Supreme Court affirmed Neder’s conviction because there was enough evidence in the record to find an el- ement of the offense—even though the jury never made such a finding. 527 U.S. at 16–18. Neder thus undermines rather than supports the majority’s primary rationale in this plain-error case. 16 answer is that they haven’t; our colleagues overwhelmingly understand the difference between judicial factfinding and plain-error remedial discretion.7 By holding that we may not review the whole record at prong four, the majority positions us on the short end of a lop- sided circuit split. It fails to identify a “compelling basis” to do so, in defiance of our Court’s “general[] reluctan[ce]” to create such splits. In re Asbestos Prod. Liab. Litig. (No. VI), 921 F.3d 98 , 109 (3d Cir. 2019) (internal quotation marks omitted) (quoting Parker v. Montgomery Cty. Corr. Facility/Bus. Office Manager, 870 F.3d 144 , 152 (3d Cir. 2017)). More im- portantly, the majority’s criticisms of our sister circuits’ posi- tions are mistaken. Consider the majority’s handling of the Eleventh Circuit’s decision in United States v. Reed. The defendant in Reed was convicted by a jury of possessing a firearm as a felon, and the Eleventh Circuit affirmed his conviction. 941 F.3d at 1019. The Supreme Court vacated the Eleventh Circuit’s judg- ment of affirmance in light of Rehaif and remanded for recon- sideration. Id. On remand, the Eleventh Circuit once again af- firmed. Id. at 1022. It held that an appellate court may review the whole record when assessing a Rehaif error’s effect, or lack thereof, on the fairness, integrity, or public reputation of 7 The majority sniffs that its decision is based upon “independ- ent judgment” rather than simple nose-counting. Maj. Op. 49 n.28. That misses the point. Respectfully, my suggestion is that in exercising its independent judgment the majority has inade- quately considered the extreme unlikelihood that so many of our judicial colleagues have somehow missed, or would casu- ally ignore, the due process and Sixth Amendment concerns that the majority finds so troubling. 17 judicial proceedings. Id. at 1021–22. Because the defendant’s presentence report “stated that he had been incarcerated for lengthy terms before possessing the firearm,” id. at 1020, he could not prove that the error affected “the fairness, integrity, or public reputation of his trial,” id. at 1022. Accordingly, the Eleventh Circuit declined to set aside his conviction. Id. at 1022. The majority chides the Eleventh Circuit for relying on United States v. Vonn, 535 U.S. 55 (2002), and concluding that a court need not confine itself to the trial record at prong four, because Vonn involved review of a guilty plea rather than a conviction after a jury trial. Maj. Op. 39–40. But the majority ignores the Eleventh Circuit’s discussion of United States v. Young. See Reed, 941 F.3d at 1021. In Young, the Supreme Court denied plain-error relief where a prosecutor made im- proper comments during rebuttal because the remarks were made in response to defense counsel’s own improper remarks during summation and “were not such as to undermine the fun- damental fairness of the trial and contribute to a miscarriage of justice.” 470 U.S. at 16–19. The Court explained that it could not “properly evaluate [the defendant’s claims of error] except by viewing [them] against the entire record,” id. at 16 (empha- sis added), because Rule 52(b) “authorizes the Courts of Ap- peals to correct only ‘particularly egregious errors,’” id. at 15 (quoting Frady, 456 U.S. at 163 ). The Supreme Court has never held that the “entire rec- ord” that Young instructs us to examine means just the trial rec- ord.8 That would make no sense: reasonable people will 8 In Makiel v. Butler, 782 F.3d 882 (7th Cir. 2015), the Seventh Circuit discussed the difference between the “entire record” and the “trial record” in a case involving the materiality 18 consider all relevant information in assessing whether our de- cision to affirm Nasir’s conviction works a miscarriage of jus- tice that is inconsistent with fairness, integrity, and the good reputation of our judicial system. And unlike the majority, they will not arbitrarily ignore the indisputable fact of Nasir’s sci- enter and guilt. Maj. Op. 59–64. In deciding whether to exer- cise our discretion, we should consider reliable materials within and outside of the trial record just as thoughtful mem- bers of the public certainly will.9 standard of the Compulsory Process Clause. Id. at 908–10. Alt- hough Makiel was not a plain-error case, the court’s discussion assists our consideration of the scope of discretionary review prescribed by Olano. Similar to our task at prong four, the court in Makiel had to evaluate the defendant’s argument in light of public interests such as “the integrity of the adversary process, the interest in the fair and efficient administration of justice, and the potential prejudice to the truth-determining function of the trial process.” Id. at 909 . The Seventh Circuit concluded that when the Supreme Court instructs circuit courts to evaluate claims of trial error in the context of the “entire record,” that is broader than the “trial record.” Id. 9 Consider the prong-four significance of Nasir’s Old Chief stipulation, which of course was part of the trial record. The majority suggests that it could never be even circumstantial ev- idence of his scienter, Maj. Op. 55–57, but that assertion is not compelled by Rehaif. And it wars against common sense and experience. As a strictly logical proposition, it is true that Nasir’s stipulation proved only that he knew of his felon status as of the date of the stipulation; it did not necessarily prove that he knew he was a felon when he was arrested with the gun. But just as a factual statement can be strictly true and yet fraudulent 19  The majority also assails the Second Circuit’s decision in Miller and the Seventh Circuit’s decision in Maez. Its criti- cism of the approach taken by those two circuits is similarly unpersuasive. Miller involved a defendant whose presentence inves- tigation report showed that he spent several years in prison prior to his firearm possession, rendering it obvious that he knew he was a felon at the time of possession. 954 F.3d at 560. The Second Circuit “ha[d] no doubt that, had the Rehaif issue been foreseen by the district court, [the defendant] would have stipulated to knowledge of his felon status to prevent the jury from hearing evidence of his actual sentence.” Id. at 560. So, the court concluded, the fairness, integrity, and public reputa- tion of the judicial system would not be seriously affected by upholding the conviction; in fact, the defendant was so obvi- ously guilty that vacating his conviction “would have that ef- fect.” Id. at 559. In Maez, the Seventh Circuit largely adopted the Second Circuit approach, concluding that vacating the con- victions of two defendants whose presentence reports indicated that they served more than one year in prison on prior felony because of a material omission, Nasir’s stipulation does not foreclose the possibility that he also understood that he was a felon every day after his knowing and voluntary guilty pleas in 2000, 2001, and 2007. A thoughtful observer drawing upon her reason, experience, and common sense might easily infer from Nasir’s June 2017 stipulation that he knew of his felon status when apprehended with a gun in December 2015. Such an in- ference, though not logically required, would be patently sen- sible to many people. And surely, many will consider his stip- ulation in this light when evaluating our discretionary decision whether to notice the plain error created by Rehaif. 20 convictions would negatively affect the fairness, integrity, and public reputation of judicial proceedings. 960 F.3d at 964–66. The majority faults the Second and Seventh Circuits for “treat[ing] judicial discretion as powerful enough to override the defendant’s right to put the government to its proof when it has charged him with a crime.” Maj. Op. 46–47. But Nasir has not been deprived of that right. He had the opportunity to insist that the government be required to prove that he knew he was a felon at the time of his firearm possession. He did not do so, instead agreeing that no such proof need be presented. As a direct result of that choice, the government did not introduce evidence as to Nasir’s knowledge of his status at the time of possession though such evidence was readily available. I do not see why Nasir’s failure to object to the jury instruction and decision to instead avail himself of an Old Chief stipulation should continue to redound to his benefit now that we are ex- ercising remedial discretion. F. Nasir does not satisfy Olano’s step-four stand- ard for error-correction Our sister circuits’ approach does not “imply that relief on plain-error review is available only to the innocent.” Maj. Op. 47.10 If, for example, an error so corrupts a judicial 10 Indeed, as the Seventh Circuit recognized, “defendants can sometimes show an effect on fairness or integrity without a claim of innocence.” Maez, 960 F.3d at 962. But “though a de- fendant’s likelihood of actual guilt or innocence does not nec- essarily control the third prong of plain-error review, it may play a role at prong four.” Id. That is because a court has “broad discretion under prong four to leave even plain errors 21 proceeding as to make its verdict completely unreliable, no court would require a defendant to prove on appeal that he was actually innocent before vacating a conviction resulting from such a proceeding. See Medley, 972 F.3d at 424–25 (Quattle- baum, J., dissenting) (explaining that “central” to prong-four analysis in a criminal case “is a determination of whether, based on the record in its entirety, the proceedings against the accused resulted in a fair and reliable determination of guilt” (internal quotation marks omitted) (quoting United States v. Ramirez-Castillo, 748 F.3d 205 , 217 (4th Cir. 2014))). That is because the Third Branch would not want to put its imprimatur on a proceeding that makes a mockery of justice and reduces the system’s standing in the eyes of the public. But that is not a problem here. A simple, unobjected-to error in jury instruc- tions, where the defendant’s conviction would have been cer- tain had an objection been made at the proper time, does not cry out for an exercise of our discretion. Remanding this case for retrial is unnecessarily burden- some and seriously undermines the fairness and public reputa- tion of judicial proceedings. That broad inquiry is the standard governing our exercise of discretion. The majority compounds its error by explicitly limiting our prong-four discretion to Nasir’s trial, which, it insists, “is the only judicial proceeding at issue.” Maj. Op. 41 n.22. Not so. At prong four we ask whether refusing to cure the plain error would “seriously affect the fairness, integrity or public reputation of judicial proceed- ings” generally, not merely the particular defendant’s proceed- ing. Puckett, 556 U.S. at 135 . As the Court elaborated in Puckett, we consider whether affirming Nasir’s conviction uncorrected where [it has] no doubt as to the ultimate result of further proceedings.” Id. at 963. 22 would call into question “the integrity of the system” and be so ludicrous as to “compromise the public reputation of judicial proceedings.” Id. at 142–43 (emphasis added); see also United States v. Edgell, 914 F.3d 281 , 291 (4th Cir. 2019); United States v. Marroquin, 884 F.3d 302 , 304 (5th Cir. 2018) (Smith, J., dissenting from denial of rehearing en banc); United States v. Gonzalez-Huerta, 403 F.3d 727 , 739 (10th Cir. 2005) (en banc); id. at 742 (Ebel, J., concurring); id. at 747 (Hartz, J., concurring). Because the majority asks the wrong prong-four question, it refuses to consider information that would suggest the correct answer. Even if we improperly limited our prong-four inquiry to what the majority erroneously describes as “the actual field of play – the trial,” Maj. Op. 41 n.22, we should still affirm. When asked twice at oral argument how Nasir would attempt to dis- prove the knowledge-of-status element if the case were sent back for retrial, his counsel was unable to give a responsive answer. (That is not a criticism of counsel’s performance; there is no plausible explanation.) Instead, counsel allowed that Nasir would strategically use a remand to try to negotiate a bet- ter plea deal. In light of that revelation, I believe that thoughtful members of the public would view the majority’s judgment and Nasir’s windfall with bemused cynicism rather than reputation- enhancing admiration. G. We are bound by the Supreme Court’s plain- error precedent The majority at least purports to apply Olano and its progeny. Judge Matey’s opinion strikes out in an entirely dif- ferent direction, citing first principles. I endorse that approach in cases where lower court judges write on a blank slate, but in this appeal we are guided by ample Supreme Court precedent. 23 In any event, although we have not had the benefit of original- ist briefing and argument, I doubt that Rule 52(b)’s remedial discretion as currently applied offends the Sixth Amendment and note that Justices Scalia and Thomas both joined Olano without any reservation, originalist or otherwise. Cf. Concur- ring Op. 13–16 (criticizing Atkinson and Olano as allegedly unwarranted expansions of original plain-error doctrine). Moreover, I fail to grasp how a purportedly originalist applica- tion of plain-error review can affirm the conviction of non- criminal conduct but disallows the conviction of conduct that was certainly criminal but not properly proven. Cf. United States v. Jabateh, 974 F.3d 281 , 287 (3d Cir. 2020). ***** The Supreme Court has disapproved “a reflexive incli- nation by appellate courts to reverse because of unpreserved error,” a tendency contrary to the “strictly circumscribed” appellate-court authority to remedy unpreserved error only where necessary due to exceptional circumstances. Puckett, 556 U.S. at 134 (internal quotation marks omitted) (quoting United States v. Padilla, 415 F.3d 211 , 224 (1st Cir. 2005) (Boudin, C.J., concurring)). Yet the majority persists in the face of overwhelming, reliable information supporting Nasir’s conviction. Its error stems from a basic misunderstanding of the nature of plain-error review. I respectfully dissent from Section II.E of the majority opinion. 24

2012-04-18 02:00:19+00

http://bulk.resource.org/courts.gov/c/F3/141/141.F3d.1175.72-115-565.97-70493.html

141 F.3d 1175 NOTICE: Ninth Circuit Rule 36-3 provides that dispositions other than opinions or orders designated for publication are not precedential and should not be cited except when relevant under the doctrines of law of the case, res judicata, or collateral estoppel. Javier GARCIA-GOMEZ, Petitioner, v. IMMIGRATION AND NATURALIZATION SERVICE, Respondent. No. 97-70493. INS. No. Aia-oxp-bcu. United States Court of Appeals, Ninth Circuit. . Submitted March 13, 1998**. Decided March 24, 1998. Petition to Review a Decision of the Immigration and Naturalization Service. Before BYRON R. WHITE,*** Retired Associate Justice, JOHN T. NOONAN, JR., and SIDNEY R. THOMAS, Circuit Judges. 1 MEMORANDUM* 2 Because the parties are familiar with the procedural and factual history of this case, we will not detail it here. We ar bound to uphold the Board of Immigration Appeals determination if it is "supported by reasonable, substantial, and probative evidence on the record considered as a whole." See INS v. Elias-Zacarias, 502 U.S. 478, 481, 112 S.Ct. 812, 117 L.Ed.2d 38 (1992) (quoting 8 U.S.C. § 1105a(a)(4)). To obtain reversal of the BIA's decision, Garcia-Gomez "must show that the evidence he presented was so compelling that no reasonable factfinder could fail to find the requisite fear of persecution." Elias-Zacarias, 502 U.S. at 483-84. 3 After a thorough review of the briefs and the record, we deny Garcia-Gomez's petition for review. Petitioner failed to establish the necessary link between his alleged persecution and his political opinion, and the record is bare of evidence that he would face persecution as a former member of the Patrol upon his return to El Salvador. Because Garcia-Gomez failed to fulfill the requirements for asylum, he necessarily failed to meet the more rigorous standard for withholding of deportation. See Aruta v. INS, 80 F.3d 1389, 1396 (9th Cir.1996). 4 PETITION FOR REVIEW DENIED. ** The panel finds this case appropriate for submission without oral argument pursuant to 9th Cir.R. 34-4 and Fed.R.App.P. 34(a) ** * Honorable Byron R. White, Retired Associate Justice, United States Supreme Court, sitting by designation * This disposition is not appropriate for publication and may not be cited to or by the courts of this circuit except as provided by 9th Cir.R. 36-3

2020-12-01 23:01:30.859384+00

https://ecf.dcd.uscourts.gov/cgi-bin/show_public_doc?2020cr0188-20

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA UNITED STATES OF AMERICA v. Criminal Action No. 20-188 (CKK) JOSEPH L. STROY, Defendant MEMORANDUM OPINION AND ORDER (December 1, 2020) Now pending before the Court is Defendant Joseph L. Stroy’s (“Defendant”), Motion to Reconsider this Court’s Order Denying Release From Pretrial Detention (the “Motion to Reconsider”). For the reasons set forth herein, the Court DENIES the Motion to Reconsider. I. BACKGROUND The Court has previously outlined the facts leading up to Defendant’s present indictment in its October 14, 2020 Memorandum Opinion and Order. See Mem. Op. & Order, ECF No. 16, at 1–2 (recounting factual background). The Court expressly incorporates those facts into this Memorandum Opinion and Order, but will also recount the facts of this case below for completeness. In outlining the current background of this case, the Court has relied on the facts alleged thus far by the government in its pleadings, but the Court does not adopt these factual allegations as its own findings of fact. In January 2020, officers from the Washington, D.C., Metropolitan Police Department (“MPD”) began to investigate Defendant for his potential involvement in narcotics distribution. See Compl., Stmt. of Facts, ECF No. 1-1, at 1. “During the course of the investigation, pursuant to two search warrants issued by magistrate judges of the U.S. District Court for the District of Columbia, MPD officers placed a tracking device on [Defendant’s] vehicle.” Id. Then in March 1 2020, MPD officers observed Defendant, on multiple occasions, meeting with individuals for short periods of time in a manner consistent with narcotics trafficking. See id. For example, on March 3, 2020, MPD officers observed Defendant meeting with various individuals and engaging in hand- to-hand transactions consistent with drug trafficking behavior. See id. On September 4, 2020, MPD officers, along with federal law enforcement agents, executed a search warrant at Defendant’s apartment, located at 1200 Perry Street N.E., Washington, D.C. See id. Upon their entrance into the apartment, the officers found Defendant in the living room with his wife, Ms. April Stroy. See id.; Order, ECF No. 13, at 2. The officers then searched their apartment and identified substantial evidence of drug trafficking therein. See Compl., Stmt. of Facts, ECF No. 1-1, at 1. This evidence included a plastic bag containing approximately 22 grams of cocaine base, found in Defendant’s kitchen along with twenty-four digital scales, a cooking pot with white residue, baking soda, bags commonly used to package narcotics, and razor blades. See id. In total, the investigating officers recovered approximately 101 grams of white rock substance from Defendant’s residence, which field tested positive for cocaine base. Id. The officers also found at least seven cell phones, $2,160 in U.S. currency, and mail addressed to Defendant in the apartment. See id. And in a subsequent search of Defendant’s vehicle, the officers located additional scales and a hidden compartment, which could be used to conceal drugs. See Order, ECF No. 13, at 3; Gov’t Opp’n, ECF No. 11, at 4. In addition to this narcotics evidence, the MPD officers also found two firearms in ottomans within Defendant’s living room, located near “ammunition and a small amount of a white-rock substance that field tested positive for cocaine base.” Compl., Stmt. of Facts, ECF No. 1-1, at 1. The recovered firearms were also located approximately eight feet away from the kitchen, wherein the officers had found substantial evidence of drug trafficking. See id. 2 Specifically, the guns recovered were a Braztech revolver containing five rounds of .357 magnum with one cartridge, as well as a Taurus revolver containing five rounds of .38 ammunition. See id. Both firearms appeared fully functional and capable of firing. See id. As a result of this investigation, MPD officers placed Defendant and his wife under arrest. Id. On September 10, 2020, a grand jury returned an indictment against Defendant for one count of Unlawful Possession with Intent to Distribute 28 Grams or More of Cocaine Base, in violation of Title 21 U.S.C. §§ 841 (a)(1) and (b)(1)(B)(iii), and one count of Using, Carrying, and Possessing a Firearm During a Drug Trafficking Offense, in violation of Title 18 U.S.C. § 924 (c)(1). See Indictment, ECF No. 4. Shortly thereafter, Magistrate Judge Robin Meriweather held a detention hearing and ordered that Defendant remain detained pending trial. See Minute Entry (Sept. 10, 2020); Order, ECF No. 13, at 2. In turn, Defendant moved this Court to reverse Magistrate Judge Meriweather’s pretrial detention order and to release Defendant before trial, see Def.’s Mot., ECF No. 7, but the Court denied Defendant’s motion for bond review in its October 14, 2020 Memorandum Opinion and Order, see Mem. Op. & Order, ECF No. 16, at 10. In its decision denying Defendant’s request for pretrial release, the Court first explained that Defendant’s current charges “trigger[] a rebuttable presumption under the Bail Reform Act ‘that no condition or combination of conditions will reasonably assure the appearance of the person as required and the safety of the community.’” Id. at 5 (quoting 18 U.S.C. § 3142 (e)(3)). Next, the Court found that the charges against Defendant, which involve a significant volume of narcotics and multiple firearms, are serious and represent a danger to the community. See Mem. Op. & Order, ECF No. 16, at 6–8. Upon review of the record, the Court also found that the “weight of the evidence” in support of the charges against Defendant is strong. See id. As such, the Court concluded that the balance of factors under the Bail Reform Act weighed in favor of Defendant’s 3 pretrial detention. See id. at 8 . Moreover, the Court reached this conclusion, notwithstanding the facts presented by Defendant pertaining to his community and familial ties, see id. at 7–8, as well as his health and COVID-19 related concerns, see id. at 8–10. Defendant, however, now moves the Court to reconsider its own October 14, 2020 order and release Defendant into home confinement pending trial. See Def.’s Mot., ECF No. 18, at 1. In his present Motion to Reconsider, Defendant focuses on two “additional” facts regarding his “personal circumstances” not previously raised with the Court. Id. at 2 . First, Defendant highlights the fact that his “mother passed away two years ago after a battle with cancer,” and that “[d]uring her illness, [he] spent significant time caring for her and he is still grieving the loss.” Id. Second, Defendant notes that he “attended classes throughout 2019” in pursuit of “a new career” in the information technology (“IT”) field, but “failed [his] most recent exam” for certification and subsequently became depressed. Id. According to Defendant, [t]hese personal factors indicate that if any of the alleged conduct in this case is ultimately proven, [he] is a person who made a bad decision during a time of personal struggle.” Id. Finally, Defendant’s Motion to Reconsider also emphasizes his family ties. In particular, Defendant highlights his supportive wife, April Stroy, and their aspirations to have children in the future. See id. at 3 . Furthermore, Defendant also references the strength of his “personal community” in Washington, D.C., which includes his father, brother, sister-in-law, and the mother of his sister-in-law. See id. These individuals have each submitted a letter to the Court regarding their relationships with Defendant. In response, the government has filed an opposition brief objecting to Defendant’s pretrial release and reasserting that his pretrial detention is appropriate under the Bail Reform Act. See Gov’t Opp’n, ECF No. 19, at 2–5. 4  II. LEGAL STANDARD The Bail Reform Act requires a defendant’s release before trial, unless no conditions of release exist that “will reasonably assure the appearance of the [defendant] as required and the safety of any other person and the community.” 18 U.S.C. § 3142 (e)(1). “In common parlance, the relevant inquiry is whether the defendant is a ‘flight risk’ or a ‘danger to the community.’” United States v. Vasquez-Benitez, 919 F.3d 546 , 550 (D.C. Cir. 2019). In determining the need for pretrial detention, the Bail Reform Act sets out four factors for courts to consider: (1) “the nature and circumstances of the offense charged, including whether the offense is a crime of violence,” (2) “the weight of the evidence against the person,” (3) “the history and characteristics of the person,” and (4) “the nature and seriousness of the danger to any person or the community that would be posed by the person’s release.” 18 U.S.C. § 3142 (g)(1)–(4). Under this framework, danger to the community alone is a sufficient reason to order pretrial detention. United States v. Salerno, 481 U.S. 739 , 754–55 (1987). The Bail Reform Act, however, “requires that detention be supported by ‘clear and convincing evidence’ when the justification is the safety of the community.” United States v. Simpkins, 826 F.2d 94 , 96 (D.C. Cir. 1987) (quoting 18 U.S.C. § 3142 (f)). Importantly, the Act also stipulates that certain charges trigger a rebuttable presumption “that no condition or combination of conditions will reasonably assure . . . the safety of the community . . . . ” 18 U.S.C. § 3142 (e)(3); see also United States v. Smith, 79 F.3d 1208 , 1210 (D.C. Cir. 1996). Finally, “[a] court may reconsider its decision regarding pretrial detention ‘at any time before trial if the judicial officer finds that information exists that was not known to the movant at the time and that has a material bearing on the issue’ of whether there exist conditions for release that would “reasonably assure the appearance of such person as required,” United States v. Bikundi, 5  73 F. Supp. 3d 51 , 54 (D.D.C. 2014) (quoting 18 U.S.C. § 3142 (f)(2)(B)), and “the safety of any other person and the community,” 18 U.S.C. § 3142 (f)(2)(B). III. DISCUSSION Upon review of Defendant’s Motion to Reconsider and the entire record in this case, the Court finds no reason to reverse its October 14, 2020 order affirming Magistrate Judge Meriweather’s pretrial detention order. See Mem. Op. & Order, ECF No. 16, at 10. As an initial matter, the material now raised in Defendant’s Motion to Reconsider does not appear to be information that “was not known to [him] at the time” of his initial detention hearing. 18 U.S.C. § 3142 (f)(2)(B); see also Gov’t Opp’n, ECF No. 19, at 2. To the contrary, Defendant’s current argument presents material about his mother’s death two years ago, his 2019 failure of an IT certification exam, and aspects of his family relationships. See Def.’s Mot., ECF No. 18, at 2–3. The Court does not doubt the sincerity of such hardships, but notes that this information was presumably “known” to Defendant at the time of the earlier proceedings regarding his pretrial detention, and, therefore, does not merit a reopening of his pretrial detention hearing. See 18 U.S.C. § 3142 (f)(2)(B); United States v. Gage, No. CR 18-112-03 (RMC), 2019 WL 3459075 , at *3 (D.D.C. July 31, 2019) (finding “no justification to reopen the detention proceeding” and refusing to “reconsider its decision to detain” the defendant). But even if the Court did reconsider Defendant’s pretrial detention order in light of the facts raised in his Motion to Reconsider, the § 3142(g) factors still weigh in favor of his detention. As noted above, Defendant’s Motion to Reconsider emphasizes the fact that his alleged criminal acts occurred after his mother passed away and also after he failed an IT certification exam. See Def.’s Mot., ECF No. 18, at 2–3. Defendant argues that because of these hardships, the alleged conduct that led to his arrest should be viewed as an “aberration.” Id. at 3. Furthermore, Defendant 6 emphasizes the strength of his familial relationships and argues that these relationships would help “hold him accountable,” if released. Id. The Court acknowledges that these facts bear on Defendant’s personal history and characteristics and are, therefore, cognizable under the § 3142(g)(3) factor of the Bail Reform Act. See Gov’t Opp’n, ECF No. 19, at 4. Nonetheless, two principal issues prevent these additional facts from tilting the overall balance of the § 3142(g) factors, which still weighs in favor of Defendant’s pretrial detention. First, Defendant’s argument that his alleged arrest conduct was an “aberration” is contradicted by the record. As an initial matter, Defendant has five prior drug-related criminal convictions since 2001, demonstrating criminal conduct before the personal hardships to which he now cites. See Pretrial Services Rpt., ECF No. 8, at 1–4. Furthermore, the alleged offense conduct in this case was not brief. Instead, the criminal complaint depicts a protracted period of alleged narcotics trafficking carried out over many months and culminating in a search of Defendant’s apartment, which uncovered substantial amounts of cocaine base and multiple, loaded firearms. See Compl., Stmt. of Facts, ECF No. 1-1, at 1. Such facts do not comport with Defendant’s argument that his alleged conduct was merely a momentary lapse in judgment. Relatedly, the Court notes that Defendant’s alleged offense conduct occurred within Washington D.C., including at his own apartment, see id., while Defendant was on supervised probation for a prior offense, see Pretrial Services Rpt., ECF No. 8, at 3. As such, Defendant engaged in the alleged offense conduct in this case while he was already living amongst the large, personal community he cites to in his Motion to Reconsider, and also while he was on supervisory release. These facts undercuts Defendant’s argument that his personal community “will hold him accountable,” if he is released again. See Def.’s Mot., ECF No. 18, at 3. Because of these offsetting factors, the Court finds that the balance of Defendant’s personal history and 7 characteristics remains in equipoise, even with the additional facts cited in his Motion to Reconsider. 18 U.S.C. § 3142 (g)(3). Second, the remaining § 3142(g) factors weigh strongly in favor of Defendant’s pretrial detention. See 18 U.S.C. § 3142 (g)(1)–(2), (4). As discussed, Defendant’s alleged offense conduct is serious, as it involves the alleged possession of over 100 grams of cocaine base and the possession of two loaded firearms. See Mem. Op. & Order, ECF No. 16, at 6–7. 1 Additionally, the alleged offense conduct includes Defendant’s participation in alleged hand-to-hand narcotics transactions carried out in public. See Compl., Stmt. of Facts, ECF No. 1-1, at 1. This alleged conduct represents a danger to the community. See 18 U.S.C. § 3142 (g)(4); United States v. Malone, 983 F. Supp. 2d 148 , 152 (D.D.C. 2013) (“[T]he combination of sufficient quantities of drugs to engage in large-scale sales and the presence of a weapon and ammunition at . . . home is sufficient to find that [the defendant] poses a danger to the community.”) (quotation omitted). Moreover, there is strong evidence in the current record demonstrating Defendant’s alleged criminal conduct. See Mem. Op. & Order, ECF No. 16, at 6–7 (noting the “tangible evidence of criminal narcotics activity and gun possession” found in Defendant’s apartment). And finally, Defendant’s current Motion to Reconsider does nothing to rebut these facts. Accordingly, the Court finds that the remaining § 3142(g) factors continue to weigh in favor of Defendant’s pretrial detention and, on balance, outweigh the mitigating facts contained in Defendant’s Motion to Reconsider. See United States v. Bikundi, 73 F. Supp. 3d 51 , 54 (D.D.C. 2014). 1 The indictment charges Defendant with a violation of 18 U.S.C. § 924 (c)(1), for using, carrying, and possessing a firearm during a drug trafficking offense. See Indictment, ECF No. 4. This charge carries a mandatory, consecutive term of imprisonment of at least five years. See 18 U.S.C. § 924 (c)(1)(A); Abbott v. United States, 562 U.S. 8 , 13 (2010). 8  IV. CONCLUSION The Court has evaluated Defendant’s Motion to Reconsider and the facts set forth therein. For the reasons set forth in this Memorandum Opinion and Order, however, the Court finds by clear and convincing evidence that there remain no conditions of release for Defendant, at this time, that “will reasonably assure . . . the safety of any other person and the community.” 18 U.S.C. § 3142 (e)(1). The Court, therefore, finds no basis to reverse its October 14, 2020 order in favor of Defendant’s continued pretrial detention. See Mem. Op. & Order, ECF No. 16, at 10. It is hereby ORDERED that Defendant’s [18] Motion to Reconsider is DENIED. Date: December 1, 2020 /s/ COLLEEN KOLLAR-KOTELLY United States District Judge 9

2020-12-01 23:02:42.759608+00

http://www.courts.ca.gov/opinions/documents/B302241M.PDF

Filed 12/1/20 (unmodified opinion attached) CERTIFIED FOR PUBLICATION IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA SECOND APPELLATE DISTRICT DIVISION THREE PRESCRIPTION OPIOID CASES. B302241 (JCCP No. 5029) ORDER MODIFYING OPINION [NO CHANGE IN JUDGMENT] THE COURT: It is ordered that the opinion filed on November 25, 2020, be modified as follows: On page 1, as part of the counsel listing for Real Parties in Interest Johnson & Johnson and Janssen Pharmaceuticals, Inc., the name O’Melveny & Meyers should be corrected to read as O’Melveny & Myers. The sentence beginning at the bottom of page 8, and continuing to the top of page 9, is revised as follows: the word “discreet” is replaced with “discrete” (that portion of the sentence shall read, “. . . constitutes its own discrete . . .”). There is no change in the judgment. ________________________________________________________________________ EGERTON, J. LAVIN, Acting P. J. DHANIDINA, J. Filed 11/25/20 (unmodified opinion) CERTIFIED FOR PUBLICATION IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA SECOND APPELLATE DISTRICT DIVISION THREE PRESCRIPTION OPIOID CASES. B302241 (JCCP No. 5029) ORIGINAL PROCEEDINGS in mandate. William F. Highberger, Judge. Petition denied. Robins Kaplan, Roman M. Silberfeld, Bernice Conn, Michael A. Geibelson, Glenn A. Danas and Lucas A. Messenger for Petitioners. No appearance for Respondent. O’Melveny & Meyers, Michael G. Yoder, Amy J. Laurendeau, Charles C. Lifland, Sabrina H. Strong and Jonathan P. Schneller for Real Parties in Interest Johnson & Johnson and Janssen Pharmaceuticals, Inc. Morgan, Lewis & Bockius, Collie F. James IV and Steven A. Reed for Real Parties in Interest Teva Pharmaceutical Industries Limited, Teva Pharmaceuticals USA, Inc., Cephalon, Inc., Actavis LLC, Actavis Pharma, Inc. and Watson Laboratories, Inc.  Arnold & Porter Kaye Scholer, Sean Morris, John Lombardo and Tiffany Ikeda for Real Parties in Interest Endo Health Solutions Inc. and Endo Pharmaceuticals Inc. Covington & Burling, Nathan E. Shafroth and Raymond G. Lu for Real Party in Interest McKesson Corporation. Reed Smith, Steven J. Boranian, Adam D. Brownrout, Eric J. Buhr, Alexis A. Rochlin and Sarah B. Johansen for Real Party in Interest AmerisourceBergen Corporation. Baker & Hostetler and Teresa C. Chow for Real Party in Interest Cardinal Health, Inc. Kirkland & Ellis and Zachary Byer for Real Parties in Interest Allergan PLC, Allergan Finance, LLC, Allergan, Inc. and Allergan USA, Inc. Ropes & Gray and Rocky C. Tsai for Real Party in Interest Mallinckrodt LLC. _________________________ In this case we hold Code of Civil Procedure section 170.6 authorizes only one judicial peremptory challenge for each side in a Judicial Council Coordination Proceeding under rule 3.516 of the California Rules of Court.1 As we explain, rule 3.516 modifies the normal procedures governing section 170.6 peremptory challenges in two ways to conform the procedures to the unique characteristics of a coordination proceeding. The rule (1) requires the party making a peremptory challenge to submit it in writing 1 Statutory references are to the Code of Civil Procedure, unless otherwise designated. Rule references are to the California Rules of Court. 2 to the assigned judge within 20 days after service of the order assigning the judge to the coordination proceeding; and (2) specifies that all plaintiffs or similar parties constitute “a side” and all defendants or similar parties constitute “a side” for purposes of “applying Code of Civil Procedure section 170.6.” (Rule 3.516.) Rule 3.516 does not displace section 170.6’s fundamental directive that there shall be “only one motion for each side . . . in any one action or special proceeding.” (§ 170.6, subd. (a)(4).) The trial court correctly interpreted and applied the rule. We deny the writ. FACTS AND PROCEDURAL BACKGROUND Petitioners and other similarly situated California governmental entities filed actions in several counties throughout the state against Real Parties alleging claims for false advertising, nuisance, fraud, negligent failure to warn, and civil conspiracy arising out of Real Parties’ manufacture and distribution of opioid products.2 On May 9, 2019, the Presiding Judge of the Orange County Superior Court, Judge Kirk Nakamura, under the authorization of the Chairperson of the Judicial Council, assigned Judge Peter Wilson to be the coordination motion judge. On May 29, 2019, Petitioners filed a section 170.6 peremptory challenge to disqualify Judge Wilson. On May 31, 2019, Judge Nakamura granted the peremptory challenge and reassigned the coordination motion to Orange County Superior Court Judge William Claster. 2 Several of the cases were removed to federal court and transferred to a multidistrict litigation pending in Ohio. The Kern County and City of El Monte cases were remanded to state court. 3  On June 3, 2019, the California Attorney General filed a lawsuit against one of the Real Parties in Los Angeles County Superior Court. The Attorney General requested Judge Claster consider the action for coordination. On September 6, 2019, Judge Claster granted the coordination petition as to Petitioners’ actions. Judge Claster also found Los Angeles County, where two of the three coordinated actions were pending, was the appropriate venue for the coordination proceeding. On September 30, 2019, Los Angeles County Superior Court Judge William Highberger was assigned as the coordination trial judge. On October 11, 2019, Petitioners filed a second section 170.6 peremptory challenge to disqualify Judge Highberger. Real Parties filed an objection, arguing section 170.6 and rule 3.516 allow only one peremptory challenge per side in a coordination proceeding and Petitioners had already used their challenge to strike Judge Wilson. On October 31, 2019, Judge Highberger denied Petitioners’ motion to disqualify. This writ proceeding followed. DISCUSSION 1. Standard of Review An order granting or denying a motion to disqualify is normally reviewed for an abuse of discretion. (See People v. Superior Court (Maloy) (2001) 91 Cal.App.4th 391 , 395; Zilog, Inc. v. Superior Court (2001) 86 Cal.App.4th 1309 , 1315.) However, it is settled that a trial court lacks discretion to deny a section 170.6 motion that complies with the applicable statutory procedures. (Bontilao v. Superior Court (2019) 37 Cal.App.5th 980 , 987; Maas v. Superior Court (2016) 1 Cal.5th 962 , 972; Pickett v. Superior Court (2012) 203 Cal.App.4th 887 , 892; see 4 also Daniel V. v. Superior Court (2006) 139 Cal.App.4th 28 , 39 [“trial court abuses its discretion when it erroneously denies as untimely a section 170.6 challenge”].) “Because the trial court exercises no discretion when considering a section 170.6 motion, it is ‘appropriate to review a decision granting or denying a peremptory challenge under section 170.6 as an error of law.’ ” (Bontilao, at pp. 987–988.) Moreover, de novo review is especially suitable in this case because the underlying material facts are not in dispute and the question to be decided is one of statutory construction. (See People v. Superior Court (Olivo) (2019) 36 Cal.App.5th 942 , 947 [“Where the underlying material facts are not in dispute, we review the trial court’s order denying a peremptory challenge de novo.”]; Jenkins v. County of Riverside (2006) 138 Cal.App.4th 593 , 604 [“Questions of statutory interpretation, and the applicability of a statutory standard to undisputed facts, present questions of law, which we review de novo.”].) “The ordinary principles of statutory construction govern our interpretation of the California Rules of Court. [Citations.] Our objective is to determine the drafter’s intent. If the rule’s language is clear and unambiguous, it governs.” (Alan v. American Honda Motor Co., Inc. (2007) 40 Cal.4th 894 , 902 (Alan).) “We give the words of the statute ‘a plain and commonsense meaning’ unless the statute specifically defines the words to give them a special meaning.” (MacIsaac v. Waste Management Collection & Recycling, Inc. (2005) 134 Cal.App.4th 1076 , 1083.) We also attempt to give meaning “to every word, phrase, sentence and part of a court rule,” if possible. (Crespin v. Shewry (2004) 125 Cal.App.4th 259 , 265.) 5 2. Rule 3.516 Does Not Displace Section 170.6’s One-Challenge-Per-Side Limitation Section 170.6 permits “[a] party . . . appearing in[ ] an action or proceeding” to disqualify the assigned judge by filing a motion and sworn statement of the party’s belief that the judge is prejudiced against that party or the party’s attorneys. (§ 170.6, subd. (a)(2).) The statute specifies various deadlines for filing the motion depending on whether the case is civil or criminal, whether the judge is “assigned to the case for all purposes,” whether the judge is “known at least 10 days before the date set for trial or hearing,” whether the motion is “directed to the trial of a cause with a master calendar,” or whether “the court in which the action is pending is authorized to have no more than one judge.” (Ibid.) Regardless of which deadline applies, section 170.6 authorizes “only one motion for each side . . . in any one action or special proceeding.” (Id., subd. (a)(4).)3 Rule 3.516 establishes special rules for applying section 170.6 in a Judicial Council Coordination Proceeding.4 The rule 3 Section 170.6 permits “the party who filed [an] appeal that resulted in the reversal of a final judgment of a trial court” to make an additional peremptory challenge, “[n]otwithstanding paragraph [(a)](4),” “following reversal on appeal . . . if the trial judge in the prior proceeding is assigned to conduct a new trial on the matter.” (§ 170.6, subd. (a)(2).) 4 Section 404 et seq. authorizes the Chairperson of the Judicial Council to coordinate separate complex civil actions pending in different counties involving common issues of fact or law into a coordination proceeding for pretrial and trial before a single assigned judge. Under the authority granted in the coordination statutes (see § 404.7), the Judicial Council has adopted detailed rules regulating the procedures for coordination 6 consists of two sentences that modify the normal procedures governing peremptory challenges to conform those procedures to the unique characteristics of a coordination proceeding. The first sentence of rule 3.516 establishes the deadline for filing a peremptory challenge: “A party making a peremptory challenge by motion or affidavit of prejudice regarding an assigned judge must submit it in writing to the assigned judge within 20 days after service of the order assigning the judge to the coordination proceeding.” (Rule 3.516.) Because the process for assigning a judge to a coordination proceeding “is a complex and time consuming process, . . . the Judicial Council . . . extended the time for filing a disqualification motion to 20 days after service of the coordination order.” (School Dist. of Okaloosa County v. Superior Court (1997) 58 Cal.App.4th 1126 , 1135; cf. Sunrise Financial, LLC v. Superior Court (2019) 32 Cal.App.5th 114 , 128 (Sunrise Financial) [because case did not involve Judicial Council assignment under section 403, and independent calendar judge had already been assigned for all purposes, normal 15-day deadline under section 170.6, subdivision (a)(2) applied].) The rule’s second sentence specifies how “a side” is defined for purposes of applying section 170.6 in a coordination proceeding consisting of two or more coordinated actions: “All plaintiffs or similar parties in the included or coordinated actions proceedings. Those rules appear at rules 3.501 through 3.550. (See Weil & Brown, Cal. Practice Guide: Civil Procedure Before Trial (The Rutter Group 2020) ¶¶ 12:370 to 12:375.) 7 constitute a side and all defendants or similar parties in such actions constitute a side for purposes of applying Code of Civil Procedure section 170.6.” (Rule 3.516, italics added.)5 Thus, while a coordination proceeding includes multiple coordinated actions, often brought by many plaintiffs against many defendants, rule 3.516 specifies that all the plaintiffs and all the defendants in those multiple actions each collectively constitute one “side” for purposes of applying section 170.6. Apart from this specification, there is no other explicit instruction in rule 3.516 regarding the statutory directive that there shall be “only one motion for each side . . . in any one action or special proceeding.” (§ 170.6, subd. (a)(4), italics added.) Petitioners contend rule 3.516 makes an additional change to section 170.6, but they say we must look to the definitions in rule 3.501 to discern it. Petitioners emphasize rule 3.501(8) defines “ ‘Coordination proceeding’ ” to mean “any procedure authorized by [section 404 et seq.] and by the rules in this chapter.” (Italics added.) Because the Judicial Council used the phrase “any procedure” to define the term “ ‘Coordination proceeding’ ” (rule 3.501(8)), Petitioners maintain the definition must be read to mean that each “procedure” authorized under the coordination statutes constitutes its own discreet “coordination proceeding,” including the assignment of the coordination motion 5 Rule 3.501(5) defines “ ‘Coordinated action’ ” as “any action that has been ordered coordinated with one or more other actions under” section 404 et seq. Rule 3.501(8) defines “ ‘Coordination proceeding’ ” as “any procedure authorized by [section 404 et seq.] and by the rules in this chapter.” 8 judge (see § 404.4) and the assignment of the coordination trial judge (see § 404.3). In other words, Petitioners argue “different judicial assignments for different purposes are discrete coordination proceedings within the umbrella of [a Judicial Council Coordination Proceeding].” (Italics added.) And, because the Judicial Council used the term “coordination proceeding” in the first sentence of rule 3.516 to fix the deadline for filing a peremptory challenge, Petitioners argue the rule “authorizes peremptory challenges for each of these distinct ‘coordination proceedings,’ ” “entitling a party to separate judicial challenges,” “so long as the challenges are made within 20 days of the [judicial] assignment.” The relevant rules and statutes are not reasonably susceptible of this interpretation. Our Supreme Court has long recognized the one-challenge- per-side limitation in section 170.6 is a critical safeguard to prevent “ ‘a device intended for spare and protective use’ ” from being “ ‘converted into a weapon of offense and . . . obstruction to efficient judicial administration.’ ” (Solberg v. Super. Ct. of City & Cty. of S.F. (1977) 19 Cal.3d 182 , 197–198; accord Peracchi v. Superior Court (2003) 30 Cal.4th 1245 , 1252–1253.) “[S]ection 170.6 is designed to prevent abuse by parties that merely seek to delay a trial or obtain a more favorable judicial forum. [Citations.] An important element of that design is the limitation, in any one action, of each party to a single motion, or each side to a single motion, should there be more than one plaintiff or defendant. . . . This limitation also reflects the general aim of the legislation to strike a balance between 9 the needs of litigants and the operating efficiency of the courts. [Citation.] [¶] To effectuate the Legislature’s intent, our courts ‘have been vigilant to enforce the statutory restrictions on the number and timing of motions permitted.’ ” (The Home Ins. Co. v. Superior Court (2005) 34 Cal.4th 1025 , 1032–1033 (Home Ins.).) Petitioners contend the legislative design of section 170.6 is irrelevant to a reasonable construction of rule 3.516. They emphasize that, with the enactment of section 404.7, “the Legislature expressly authorized the Judicial Council ‘to formulate its own rules for judicial challenges independent of the provisions of section 170.6.’ ” (See Industrial Indemnity Co. v. Superior Court (1989) 214 Cal.App.3d 259 , 264 (Industrial Indemnity).) And, as discussed, Petitioners maintain the Judicial Council did just that—it created a new rule, displacing the one- challenge-per-side limitation, by adopting rule 3.516 and linking the deadline for making a peremptory challenge to the term “coordination proceeding” as defined in rule 3.501(8). We are not persuaded. It is a settled rule of statutory construction, applicable to the Rules of Court adopted by the Judicial Council, that “it is not to be presumed that the legislature in the enactment of statutes, or the people in the adoption of laws, intend to overturn long- established legal principles, unless such intention is made to clearly appear by express declaration or by necessary implication.” (Follette v. Pacific Light & Power Corporation (1922) 189 Cal. 193 , 208, italics added; accord In re Guardianship of Thrasher (1951) 105 Cal.App.2d 768 , 777; see Alan, supra, 40 Cal.4th at p. 902; 10 cf. Subsequent Injuries Fund v. Industrial Acc. Com’n (1963) 59 Cal.2d 842 , 844 [“Where the amendment of a statute consists of the deletion of an express provision, the presumption is that a substantial change in the law was intended.”].) As we have explained, the one-challenge-per-side limitation is an “important element” of section 170.6’s statutory design. (Home Ins., supra, 34 Cal.4th at p. 1032.) It is essential “to prevent abuse by parties that merely seek to delay a trial or obtain a more favorable judicial forum,” and courts must be “ ‘vigilant to enforce’ ” it. (Id. at pp. 1032–1033.) Because the limitation is critical to effectuating section 170.6’s legislative purpose, we cannot accept that the Judicial Council would have overturned it in the circuitous and oblique way Petitioners suggest. Had the Judicial Council intended to make such a fundamental change to the established rules governing judicial peremptory challenges, we must presume the Council would have done so only “by express declaration or by necessary implication.” (Follette, at p. 208.) There is plainly no express declaration in rule 3.516 overturning the one-challenge-per-side limitation. Nor does the term “coordination proceeding” annul the limitation by necessary implication. As we have discussed, on its face, the first sentence of rule 3.516 merely establishes a deadline for filing a peremptory challenge “within 20 days after service of the order assigning the judge to the coordination proceeding.” (Rule 3.516.) While this language can account for two separate orders assigning different judges to a coordination proceeding—one for the coordination motion judge and one for the trial judge—the language does not necessarily imply that each side gets a separate peremptory 11 challenge for each judicial assignment. On the contrary, we construe this language to require a side to file a peremptory challenge within 20 days of either the assignment of the coordination judge or the assignment of the trial judge, but we do not read it to displace the one-challenge-per-side limitation, which remains an “important element” of section 170.6’s statutory design. (Home Ins., supra, 34 Cal.4th at p. 1032.) Our construction is consistent with the normal operation of the one-challenge-per-side limitation in civil actions generally. Under section 170.6, litigants are permitted to choose from multiple potential triggers for a peremptory challenge—e.g., assignment of the trial judge, assignment of the judge for all purposes, or commencement of a hearing. (See § 170.6, subd. (a)(2).) However, notwithstanding these various triggers, the statute mandates that there shall be “only one” peremptory challenge for each side “in any one action or special proceeding”— not separate challenges each time a triggering event occurs. (Id., subd. (a)(4).)6 We presume that the Judicial Council “was aware 6 As the trial court observed, “[i]t is commonplace that in a master-calendar docket management system any number of jurists may make rulings during the life of a case on matters such as demurrers, discovery motions, requests for interim injunctive relief, potentially dispositive motions, and trials. A party may, if he, she or it wishes, use a challenge under [section] 170.6 on the occasion of any of these events . . . but the upshot of doing so is that the party will lack an available challenge for the balance of the case’s life . . . but that is the lawyer’s choice.” Nothing in rule 3.516 suggests the Judicial Council intended to treat coordination proceedings any differently. 12 of existing related laws” when it enacted rule 3.516, and that it “intended to maintain a consistent body of rules.” (People v. Superior Court (Zamudio) (2000) 23 Cal.4th 183 , 199; cf. Paterno v. Superior Court (2004) 123 Cal.App.4th 548 , 555 (Paterno) [Since rule 3.516 predecessor’s “provisions for exercising a peremptory challenge upon initial assignment may be harmonized with section 170.6(a)(2)’s postappeal right to peremptory challenge, the latter is simply one of the ‘provisions of law applicable to civil actions generally,’ which still retains vitality in coordination proceedings.”].) Petitioners principally rely upon Stone v. Superior Court (1994) 25 Cal.App.4th 1144 (Stone). The case supports our construction of rule 3.516. In Stone, the plaintiff elected not to challenge the coordination motion judge, who later coordinated the plaintiff’s action with other factually related cases. (Stone, at p. 1146.) When the same judge was appointed to be the coordination trial judge, the plaintiff filed a peremptory challenge within 20 days of receiving the appointment order. (Ibid.) The judge denied the challenge on the ground it was untimely, reasoning that rule 3.516 “require[ed] any peremptory challenge to be filed within twenty days of his first assignment” because that was when he became an “ ‘assigned judge’ ” under the rule. (Stone, at p. 1147, italics added.)7 The reviewing court disagreed. 7 Stone was decided under a substantively identical predecessor to rule 3.516. (See Stone, supra, 25 Cal.App.4th at p. 1146 [quoting former rule 1515].) 13  The Stone court reasoned that requiring a party to file a peremptory challenge within 20 days of the “first” judicial assignment would not sufficiently protect a party’s rights under section 170.6, because a party could not reasonably be expected “to predict whether the judge assigned as the coordination motion judge will also be assigned as the coordination trial judge.” (Stone, supra, 25 Cal.App.4th at p. 1147.) The court explained, “the statutory scheme for coordination and the rules of court implementing that scheme provide for two separate assignments” and “contemplate the possibility these two assignments will be of two different judges.” (Ibid.) In view of this possibility, the Stone court concluded “the term ‘assigned judge’ ” in rule 3.156 “must be read as the judge assigned for the particular purpose, i.e., either to determine whether coordination is appropriate or to hear and determine the coordinated actions.” (Stone, at p. 1147.) Under that construction, “a party challenging the assignment of a judge pursuant to Code of Civil Procedure section 170.6 has 20 days after the specific assignment to file an affidavit of prejudice.” (Ibid.) Contrary to Petitioners’ contention, Stone neither states nor implies that rule 3.516 authorizes more than one peremptory challenge per side. The case merely holds the assignment of the coordination motion judge and the assignment of the coordination trial judge constitute separate triggers for filing a disqualification motion within the prescribed 20-day period, and the election not to challenge the assigned coordination motion judge does not preclude a party from later moving to disqualify the assigned coordination trial judge—even if the same judge happens to be 14 assigned for both purposes. (Stone, supra, 25 Cal.App.4th at p. 1147.) That holding is consistent with the normal operation of the one-challenge-per-side limitation, which allows a party to reserve its peremptory challenge for a subsequent triggering event, even when the party could have exercised its challenge against a previously assigned judge. The holding is also consistent with our construction: Under rule 3.516 a side must file a peremptory challenge within 20 days of either the assignment of the coordination motion judge or the assignment of the coordination trial judge, but it cannot file a challenge against both judges. (See Sunrise Financial, supra, 32 Cal.App.5th at p. 128 [“The Stone court held a party challenging the assignment of a complex-case coordination judge (§ 404) pursuant to section 170.6 must file the challenge within 20 days after either the assignment of the judge ruling on the complex-case consolidation motion or the assignment of the judge to preside over the merits of the cases.”]; Philip Morris Inc. v. Superior Court (1999) 71 Cal.App.4th 116 , 123 [citing Stone, observing rule 3.516’s “second sentence means that once a coordination motion judge or a coordination trial judge is assigned, the plaintiff and defense sides in any included action or coordinated action, respectively, are entitled to only one section 170.6 peremptory challenge each”].) Finally, as past cases have observed, the overriding purpose of rule 3.516 “is to exclude add-on parties from the right to peremptorily challenge the coordination trial judge.” (Industrial Indemnity, supra, 214 Cal.App.3d at p. 263; accord 15 Paterno, supra, 123 Cal.App.4th at p. 554; see also Jane Doe 8015 v. Superior Court (2007) 148 Cal.App.4th 489 , 497–498 [“The 20-day time limit and the collective denomination of a ‘side’ in rule 3.516 preclude a succession of challenges that would delay the efficient resolution of coordinated actions.”].) As the trial court observed in denying Petitioners’ disqualification motion, it is “counter-intuitive” to read a rule that explicitly narrows an add-on party’s right to bring a peremptory challenge to nonetheless expand the number of peremptory challenges available in a coordination proceeding.8 The trial court properly denied Petitioners’ second disqualification motion. 8 Notwithstanding our construction of rule 3.516, Petitioners contend we should nevertheless reverse the trial court’s order because they “reasonabl[y] reli[ed]” on a handful of secondary sources suggesting peremptory challenges are available at both the coordination motion stage and coordination trial stage of a coordination proceeding. The argument has no merit. Retrospective application of a statutory interpretation is appropriate where, as here, the interpretation does not involve “ ‘unforeseeable judicial expansion of the statutory language.’ ” (County of San Diego v. State Bd. of Control (1984) 161 Cal.App.3d 868 , 870.) Even a party’s reliance on the decision of an “inferior” appellate court is no “basis to depart from the assumption of retrospective operation.” (Pineda v. Williams- Sonoma Stores, Inc. (2011) 51 Cal.4th 524 , 536 [retrospective operation of Supreme Court’s statutory interpretation did not violate due process, even though defendant had relied upon appellate court interpretation, for which review had been denied, in establishing corporate policy].) Petitioners’ reliance upon a handful of secondary sources is even less reason to depart from the usual rule of retrospective operation. (See Earl W. Schott, Inc. v. Kalar (1993) 20 Cal.App.4th 943 , 946, fn.4 [“Secondary 16  DISPOSITION The writ is denied. Real Parties are entitled to their costs. CERTIFIED FOR PUBLICATION EGERTON, J. We concur: LAVIN, Acting P. J. DHANIDINA, J. authority can never be mandatory authority; it can only be persuasive.”].) 17

2020-12-01 23:02:46.856206+00

http://www.courts.ca.gov/opinions/documents/F077267.PDF

Filed 12/1/20 CERTIFIED FOR PUBLICATION IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA FIFTH APPELLATE DISTRICT VENTURA COASTAL, LLC, F077267 Plaintiff and Appellant, (Super. Ct. No. VCU272109) v. OCCUPATIONAL SAFETY AND HEALTH OPINION APPEALS BOARD, Defendant and Respondent; DEPARTMENT OF INDUSTRIAL RELATIONS, DIVISION OF OCCUPATIONAL SAFETY AND HEALTH, Real Party in Interest and Respondent. APPEAL from a judgment of the Superior Court of Tulare County. Melinda Myrle Reed, Judge. Lebeau-Thelen, Daniel K. Klingenberger, Kelly A. Lazerson and Patrick Charles Carrick for Plaintiff and Appellant. J. Jeffrey Mojcher, Aaron R. Jackson, Autumn Gonzalez and Andia Farzaneh for Defendant and Respondent. Christopher P. Grossgart, Rocio Garcia-Reyes and Willie N. Nguyen for Real Party in Interest and Respondent. -ooOoo-  The Department of Industrial Relations, Division of Occupational Safety and Health (Division) issued a citation to an employer for a safety violation on its premises that resulted in injury to an employee. The employer contested the citation. It was upheld by the hearing officer and, on reconsideration, by the Occupational Safety and Health Appeals Board (Board). The employer filed a second petition for reconsideration by the Board, then filed a petition for writ of mandate in the trial court. On the Board’s motion for judgment on the pleadings, the trial court dismissed the writ petition, finding it was not timely filed. We conclude filing a second petition for reconsideration was not permitted when the employer was not newly aggrieved by the decision after the first reconsideration, and the petition for writ of mandate was not timely filed after the Board’s decision after the first reconsideration. In light of the recent decision in Saint Francis Memorial Hospital v. State Dept. of Public Health (2020) 9 Cal.5th 710 (Saint Francis), however, we conclude the time limitation for filing the writ petition is subject to equitable tolling, and the employer should have been allowed to amend its petition to allege facts supporting application of that doctrine. Accordingly, we reverse the judgment and remand with directions to the trial court to permit the employer to amend its petition. FACTUAL AND PROCEDURAL BACKGROUND On August 30, 2014, Isaul Alvarado, an employee of Ventura Coastal, LLC (Ventura), sustained a serious leg injury when he stepped into an uncovered screw conveyor (also known as an auger) located below ground level on Ventura’s premises. On September 19, 2014, the Division conducted an inspection of Ventura’s facility; it subsequently issued a citation to Ventura under the California Occupational Safety and Health Act (CalOSHA; Lab. Code, §§ 6300–6721) for a serious violation of a regulation requiring screw conveyors at or below floor level to be guarded by railings or substantial covers or gratings (Cal. Code Regs., tit. 8, § 3999, subd. (a)). Ventura appealed the 2. citation to the Board, arguing that it did not violate the safety order or, if there was a violation, it was misclassified as serious. The matter was heard before an administrative law judge (ALJ). After taking evidence, the ALJ issued a decision with the following findings: a section of the screw conveyor was uncovered at the time of the incident; an employee had removed the grate that covered the screw conveyor on at least two occasions in the two-month period prior to the incident; a supervisor, Manuel Sierra, was standing on a platform with a direct line of sight to the exposed screw conveyor at the time of the incident; and, with adequate supervision and a thorough inspection of the area, Ventura could have known of the existence of the exposed screw conveyor. The ALJ upheld the citation, finding Ventura committed the violation alleged, and it was properly classified as a serious violation. The ALJ did, however, reduce the proposed penalty. The Board, on its own motion, ordered reconsideration of the ALJ’s decision regarding the penalty. Ventura also filed a petition for reconsideration by the Board, asserting as grounds for reconsideration that the evidence did not justify the findings of fact, and the findings of fact did not support the decision. On September 22, 2017, the Board issued its decision after reconsideration, upholding the decision of the ALJ. The Board concluded the Division established Ventura violated the regulation; Ventura failed to establish its defense that it did not know, and should not reasonably have known, that the screw conveyer was uncovered at the time of the incident; the violation was properly classified as serious; and the ALJ properly modified the penalty. On October 20, 2017, Ventura filed a second petition for reconsideration with the Board. It asserted three of the Board’s factual findings were not supported by the evidence, so the decision exceeded the Board’s authority. Alternatively, at a minimum, the violation should be reclassified from serious to general. On October 26, 2017, the chief counsel for the Board sent a letter to Ventura’s counsel, confirming a prior 3. telephone conversation and explaining that the Board lacked “statutory authority and/or jurisdiction to reconsider a matter after it has issued a decision after reconsideration.” On December 15, 2017, Ventura filed a petition for a writ of mandate in the superior court, seeking review of the Board’s September 22, 2017 decision. The petition named the Board as respondent and the Division as real party in interest. The Board filed a motion to dismiss or for judgment on the pleadings, asserting the writ petition was statutorily required to be filed within 30 days after the Board’s decision was issued, the time limit was jurisdictional, the writ petition was not filed within that time period, and therefore the trial court had no power to hear the matter and was required to dismiss the petition. Ventura opposed the motion, arguing its second petition for reconsideration was proper on various grounds, including the ground that Ventura was newly aggrieved by the Board’s factual findings and reliance on hearsay evidence. The trial court granted the Board’s motion and entered a judgment of dismissal. Ventura appeals from that judgment. DISCUSSION I. Standard of Review The Board’s first pleading in the trial court was captioned as a motion to dismiss or for judgment on the pleadings. It asserted Ventura’s writ petition should be dismissed or judgment should be entered in the Board’s favor because the petition was not timely filed. Like a demurrer to a complaint, the motion was based on the allegations of the petition. Generally, “ ‘[t]he bar of the statute of limitations to an action … should be set up by demurrer, or in an answer, and not by motion to dismiss.’ ” (Berendsen v. McIver (1954) 126 Cal.App.2d 347 , 351.) A demurrer may be filed in response to a petition for writ of administrative mandate. (Code Civ. Proc., § 1089; Boren v. State Personnel Board (1951) 37 Cal.2d 634 , 637–638; Hansen v. Board of Registered Nursing (2012) 208 Cal.App.4th 664 , 668–670, 675; Gong v. City of Fremont (1967) 250 Cal.App.2d 568 , 571–572.) 4.  “ ‘A judgment on the pleadings in favor of the defendant is appropriate when the complaint fails to allege facts sufficient to state a cause of action. [Citation.] A motion for judgment on the pleadings is equivalent to a demurrer and is governed by the same de novo standard of review.’ ” (People ex rel. Harris v. Pac Anchor Transportation, Inc. (2014) 59 Cal.4th 772 , 777.) Thus, whether we treat the Board’s pleading as a motion for judgment on the pleadings or as a miscaptioned demurrer, the standard of review is the same: we independently determine whether, on the state of the pleadings and any matters that may be judicially noticed, it appears the Board was entitled to judgment as a matter of law. (Schabarum v. California Legislature (1998) 60 Cal.App.4th 1205 , 1216.) In doing so, “ ‘[a]ll properly pleaded, material facts are deemed true, but not contentions, deductions, or conclusions of fact or law.’ ” (People ex rel. Harris, at p. 777.) To the extent our review requires interpretation of statutory language, we are also presented with a legal issue subject to de novo review. (Breslin v. City and County of San Francisco (2007) 146 Cal.App.4th 1064 , 1076–1077.) We are not bound by the interpretation applied by an administrative agency or by the trial court. (Id. at p. 1077.) “Instead, we make an independent review of any questions of law necessary to the resolution of this matter on appeal.” (Ibid.) II. Timeliness of Filing of Writ Petition A. Administrative process If the Division believes an employer has violated a safety regulation, it must issue a citation to the employer. (Lab. Code,1 § 6317.) The employer then has 15 working days from receipt of the citation to notify the Board that it wishes to contest the citation. (§ 6319, subds. (a), (b).) If the employer gives timely notice that it intends to contest the citation, the Board “shall afford an opportunity for a hearing.” (§ 6602.) The initial hearing may be conducted by an ALJ. (§§ 6604, 6605; Cal. Code Regs., tit. 8, § 375.1.) 1 All further statutory references are to the Labor Code unless otherwise indicated. 5. At the hearing, the parties may call and examine witnesses, introduce exhibits, and make motions. (Cal. Code Regs., tit. 8, § 376.1.) The hearing is conducted informally and need not adhere to the technical rules of admissibility of evidence. (§ 6603; Cal. Code Regs., tit. 8, § 376.2.) “Hearsay evidence may be used for the purpose of supplementing or explaining other evidence but over timely objection shall not be sufficient in itself to support a finding unless it would be admissible over objection in civil actions.” (Cal. Code Regs., tit. 8, § 376.2.) After the hearing, the ALJ or Board issues a decision, making findings of fact, summarizing the evidence received and relied upon, and affirming, modifying, or vacating the Division’s citation, or directing other appropriate relief. (§§ 6602, 6608.) The Board may confirm, adopt, modify, or set aside the findings or decision of the ALJ, and may enter its own decision based on the record in the case. (§ 6609.) Within 30 days after service of the final decision of the Board or ALJ, an aggrieved party may petition the Board for reconsideration of any matter determined or covered by the final decision, or the Board may grant reconsideration on its own motion. (§ 6614.) The Board may affirm, rescind, alter, or amend the decision, with or without further proceedings, or may grant reconsideration and direct the taking of additional evidence. (§§ 6620, 6621.) The decision of the Board must be in writing, state the evidence relied on, and specify the reasons for the decision. (§ 6623.) “A petition for reconsideration is deemed to have been denied by the appeals board unless it is acted upon within 45 days from the date of filing.” (§ 6624.) B. Review by writ petition A motion for reconsideration is a prerequisite to a court challenge to the decision of the Board. (§ 6615.) A party may challenge the Board’s decision in court by filing a petition for a writ of mandate in the appropriate superior court. (§ 6627.) “The application for writ of mandate must be made within 30 days after a petition for reconsideration is denied, or, if a petition is granted or reconsideration is had on the 6. appeals board’s own motion, within 30 days after the filing of the order or decision following reconsideration.” (Ibid.) C. Proceedings in this case The ALJ issued his decision on March 7, 2017, making eight findings of fact and concluding: (1) Ventura failed to ensure the screw conveyor was guarded by a substantial cover or grating; (2) the Division established a rebuttable presumption that the violation was serious; (3) Ventura did not rebut that presumption by demonstrating it was unaware of the violation; and (4) the Division did not demonstrate the penalty was reasonable. Ventura petitioned for reconsideration of the ALJ’s decision on three statutory grounds: (1) that by the decision, the Board acted without or in excess of its powers; (2) that the evidence did not justify the findings of fact; and (3) that the findings of fact did not support the decision. (§ 6617, subds. (a), (c), (e).) Ventura contended the Division had not met its burden of proving a violation of the regulation (Cal. Code Regs., tit. 8, § 3999, subd. (a)) by a preponderance of the evidence. It also asserted the Division failed to establish Ventura adopted or implemented any unsafe or unhealthful practice because there was no evidence Ventura’s management was aware anyone had previously removed the grate in issue; thus, the Division failed to establish the basis for a rebuttable presumption that a serious violation of the regulation occurred. Ventura further argued the evidence showed the violation was unforeseeable under the Newbery defense.2 On September 22, 2017, the Board issued its decision after reconsideration. It made 10 findings of fact, most of which were substantially similar to those of the ALJ. The Board concluded the Division established a violation of the regulation by a 2 The Newbery defense, which originated in Newbery Electric Corp. v. Occupational Safety & Health Appeals Bd. (1981) 123 Cal.App.3d 641 , 649, “states that the violation is deemed unforeseeable, therefore not punishable, if none of the following four criteria exist: (1) that the employer knew or should have known of the potential danger to employees; (2) that the employer failed to exercise supervision adequate to assure safety; (3) that the employer failed to ensure employee compliance with its safety rules; and (4) that the violation was foreseeable.” (Gaehwiler v. Occupational Safety & Health Appeals Bd. (1983) 141 Cal.App.3d 1041 , 1045.) 7. preponderance of the evidence, Ventura failed to establish the Newbery defense, the violation was properly classified as serious, and the ALJ properly modified the penalty imposed. The Board made one new factual finding that the ALJ did not make: that Sierra, the plant supervisor, “had seen the grates removed from the auger in the past and had reported the unsafe condition to upper management.” Ventura was unsatisfied with the result of reconsideration and believed the Board’s new finding was contrary to the evidence, but it did not file a petition for writ of mandate in the superior court within 30 days after the decision on reconsideration was filed (§ 6627). Instead, on October 20, 2017, 28 days after the Board filed its decision after reconsideration, Ventura filed a second petition for reconsideration with the Board. Ventura’s second petition for reconsideration challenged three of the Board’s factual findings as incorrect, that is, not supported by the evidence presented. Although counsel for the Board promptly notified Ventura’s counsel that the Board lacked the power to reconsider a decision a second time, Ventura waited until December 15, 2017, 84 days after the Board issued its decision after reconsideration, to file the petition for writ of mandate in the trial court. D. Timeliness of writ petition 1. Statutory time period Ventura has not identified any provision in the statutes relating to hearings before the Board that authorizes a party to file a second petition for reconsideration, or that authorizes the Board to reconsider the same matter it has already reconsidered. We have found none. (See §§ 6600–6633.) Ventura asserts the second petition for reconsideration was “timely filed,” and Ventura “timely invoked [sections ]6614, 6617 and 6626.” The sections cited do not authorize a second petition for reconsideration. Section 6614 provides: “(a) At any time within 30 days after the service of any final order or decision made and filed by the appeals board or a hearing officer, any party aggrieved 8.  directly or indirectly by any final order or decision, made and filed by the appeals board or a hearing officer under any provision contained in this division, may petition the appeals board for reconsideration in respect to any matters determined or covered by the final order or decision and specified in the petition for reconsideration. Such petition shall be made only within the time and in the manner specified in this chapter. “(b) At any time within 30 days after the filing of an order or decision made by a hearing officer and the accompanying report, the appeals board may, on its own motion, grant reconsideration.” (§ 6614.) Under this section, regardless whether the decision was made by the ALJ or by the Board (§§ 6608, 6609), a party aggrieved by the final decision may petition the Board for reconsideration of matters contained in the decision. The petition must be made within the time specified, i.e., within 30 days after service of the decision being challenged. (§ 6614, subd. (a).) There is no provision for a petition for reconsideration of the decision after reconsideration. Section 6617 merely sets out the grounds on which a petition for reconsideration may be based. Section 6626 provides: “Nothing contained in this chapter shall be construed to prevent the appeals board, on petition of an aggrieved party or on its own motion, from granting reconsideration of an original order or decision made and filed by the appeals board within the same time specified for reconsideration of an original order or decision.” This section emphasizes that the Board may reconsider its own original decision, in the event the original decision in the matter was made by the Board itself, rather than by an ALJ, and the same time limits apply. The Board’s decision after reconsideration may be reviewed by writ of mandate. “Any person affected by an order or decision of the appeals board may, within the time limit specified in this section, apply to the superior court of the county in which he [or she] resides, for a writ of mandate, for the purpose of inquiring into and determining the lawfulness of the original order or decision or of the order or decision following reconsideration. The application for writ of mandate must be made within 30 days after a petition for reconsideration is denied, or, if a petition is granted or reconsideration is had on the appeals board’s own motion, within 30 days after the filing of the order or decision following reconsideration.” (§ 6627.) 9.  Thus, if a party wishes to challenge the decision after reconsideration, or the ALJ’s or Board’s original decision if reconsideration was denied, an application for a writ of mandate must be timely filed within the time periods specified. The Board’s decision after reconsideration was filed on September 22, 2017. Ventura’s petition for writ of mandate was filed in the trial court on December 15, 2017, 84 days later. It was not filed within the 30-day period provided for in section 6627. Consequently, it was untimely. 2. Newly aggrieved by decision after reconsideration By analogy to worker’s compensation proceedings, Ventura argues a second petition for reconsideration is permissible when the petitioning party has been newly aggrieved by the decision after the first reconsideration. It asserts it was newly aggrieved by the Board’s decision after reconsideration because the Board made one new factual finding and relied on hearsay evidence the ALJ did not rely on; therefore, the second petition was justified. The statutes governing procedures of the Workers’ Compensation Appeals Board (WCAB) are generally similar to the statutes governing the Board’s procedures. A person aggrieved by the final decision of the workers’ compensation judge or the WCAB may petition the WCAB for reconsideration but must do so within 20 days after service of the decision. (§§ 5900, 5903.) A petition for reconsideration, or reconsideration on the WCAB’s own motion, is a prerequisite to accrual of a cause of action in court. (§ 5901.) The grounds for reconsideration by the WCAB are the same as the grounds for reconsideration by the Board. (§§ 5903, 6617.) After reconsideration, the WCAB decision is reviewable by writ, but it is reviewed by the Supreme Court or the court of appeal by application for a writ of review, and the application must be made within 10. 45 days after the petition for reconsideration is denied or a decision after reconsideration is filed. (§ 5950.)3 Under the workers’ compensation scheme, courts have held that a party generally may not file a second petition for reconsideration in the same matter. In Crowe Glass Co. v. Industrial Acc. Com. (1927) 84 Cal.App. 287 (Crowe Glass), the surviving spouse of a deceased employee sought workers’ compensation benefits based on the injury that allegedly caused the employee’s death. The Industrial Accident Commission (Commission [the predecessor of the WCAB]) denied the spouse’s claim, and she filed a petition for rehearing.4 (Id. at pp. 289–290.) The Commission granted rehearing, took further evidence, and affirmed its original decision. (Id. at p. 290.) The spouse filed a second petition for rehearing, challenging the decision on rehearing. (Id. at pp. 290–291.) The Commission granted a second rehearing and, without taking further evidence, rescinded its prior decisions and found in favor of the spouse. (Id. at p. 291.) The issue presented in the writ proceeding was whether the Commission acted in excess of its powers by granting a second rehearing. The employer contended the only procedure allowed by statute after a decision on rehearing was for an aggrieved party to apply to the court of appeal or supreme court for a writ of review. (Id. at pp. 291–292.) The spouse, however, contended “that as the statute does not expressly prohibit a second application, the Commission may entertain one,” and the provision for writ review used the word “ ‘may,’ ” not “ ‘must.’ ” (Id. at p. 292.) 3 Section 5950 provides in its entirety: “Any person affected by an order, decision, or award of the appeals board may, within the time limit specified in this section, apply to the Supreme Court or to the court of appeal for the appellate district in which he [or she] resides, for a writ of review, for the purpose of inquiring into and determining the lawfulness of the original order, decision, or award or of the order, decision, or award following reconsideration. The application for writ of review must be made within 45 days after a petition for reconsideration is denied, or, if a petition is granted or reconsideration is had on the appeal board’s own motion, within 45 days after the filing of the order, decision, or award following reconsideration.” 4 Prior to a 1951 statutory amendment, a petition for reconsideration was called a petition for rehearing. (§ 5900, as amended by Stats. 1951, ch. 778, § 13.) 11.  The court concluded: “It seems plain to us that the provisions in question contemplate but one rehearing and that thereafter, if a party feels aggrieved, he must apply to the appellate courts. If it could be held that an applicant is entitled to more than one rehearing it would follow that the employer and insurance carrier would likewise be so entitled, as the act would have to be given a uniform operation. If such right existed, an employer or insurance carrier, if they felt aggrieved upon a decision on rehearing, could again invoke the Commission’s jurisdiction to grant a second rehearing and so on indefinitely. On the other hand, where an award had been refused an applicant and a rehearing denied, he could again apply for a rehearing which could be granted or denied and so on ad infinitum. Under such a practice there would be no end to the litigation, as no time, however great, would operate to bar successive applications provided only that they were applied for in seasonable time. Such a construction would lead to legal chaos.” (Crowe Glass, supra, 84 Cal.App. 287 at p. 293.) It would also defeat the purposes of the workers’ compensation statutes, “which contemplate[] a speedy determination of controversies involved thereunder, and not a vacillating attitude on the part of the Commission.” (Crowe Glass, supra, 84 Cal.App. 287 at p. 293.) The court cited a prior Supreme Court case in which the court observed, “[i]t is the policy of the law in general practice to consider but one application for a rehearing,” and determined that the Commission’s jurisdiction was exhausted by the first petition for rehearing. (Id. at p. 294, italics omitted.) “The act in question, properly construed, contemplates but one rehearing and the party aggrieved must then look to the appellate courts for a review of the proceeding.” (Ibid.) Regarding the term “may” in the statute authorizing writ review, the Crowe Glass court stated it meant “that when a litigant elects to further proceed with his case after decision on rehearing, he must apply in accordance with the provisions of the act. The words are employed to express the existence of a privilege that may be exercised in the discretion of the applicant and this is the only remedy that a party to such a proceeding has after decision on rehearing, the jurisdiction of the Commission being exhausted upon the final disposition of that hearing.” (Id. at pp. 294–295.) 12.  The Supreme Court subsequently addressed a similar issue in Goodrich v. Industrial Acc. Com. (1943) 22 Cal.2d 604 (Goodrich). The dependents of an employee who allegedly died in a work-related accident applied for workers’ compensation benefits. (Id. at pp. 606, 609.) After an award was made, the petition for rehearing filed by the employer’s insurer was granted and compensation was denied on the ground the employee was not acting within the course and scope of his employment at the time of his death. (Id. at pp. 609–610.) The dependents later petitioned to reopen the case and take new evidence (see § 5803).5 (Goodrich, supra, 22 Cal.2d at p. 610.) The Commission denied that petition. (Ibid.) The dependents filed a petition for rehearing, which the court interpreted as a request for rehearing of the denial of reopening the case. (Id. at pp. 610, 612.) The Commission granted the petition, held a further hearing, and took additional evidence, including newly discovered evidence that could not reasonably have been produced at the original hearing. (Id. at p. 610.) On August 6, 1942, the Commission ordered that the case be reopened, but again denied compensation. (Ibid.) On August 20, 1942, the dependents filed another petition for rehearing, which was denied. (Id. at pp. 610–611.) They then filed a petition for writ of review on September 25, 1942. (Id. at p. 611.) In the writ proceeding, the Commission contended it had no jurisdiction to rule on the August 20, 1942 petition for rehearing, its final decision was the August 6, 1942 decision, and the dependents were required to file their petition for review within 30 days thereafter, which they failed to do. (Goodrich, supra, 22 Cal.2d at p. 611.) The court observed: “Generally, if a party does not prevail on the original hearing and his petition 5 Section 5803 grants the WCAB continuing jurisdiction over all its orders, decisions, and awards, to rescind, alter, or amend them with good cause. “This power includes the right to review, grant or regrant, diminish, increase, or terminate, within the limits prescribed by this division, any compensation awarded, upon the grounds that the disability of the person in whose favor the award was made has either recurred, increased, diminished, or terminated.” (§ 5803.) There is no corresponding provision in CalOSHA. 13. for a rehearing is denied, he may not again petition for a rehearing. He must seek relief in the courts. [Citations.] However, if one party prevails in the original hearing and on rehearing the other party prevails, the first party may petition for rehearing of the order made on rehearing because he has for the first time become the aggrieved party under section 5900 of the Labor Code [citations], though it may be that such petition is not a condition precedent to court review.” (Ibid.) The dependents could have petitioned for rehearing within 20 days after the decision on the insurer’s petition for rehearing, which was adverse to them. (Goodrich, supra, 22 Cal.2d at p. 611.) The August 6, 1942 decision, made after new evidence was taken, amended the previous decision by making more explicit findings, but still denied compensation. The court concluded the Commission had the power to entertain a petition for rehearing of the August 6, 1942 decision, because the Commission considered new evidence. “[T]he decision therein is in effect a new decision on new facts, and the party although failing to prevail on the last occasion as he had on the first is entitled to a reconsideration by the commission of its opinion on the new evidence. The very purpose of a rehearing is to have a reconsideration of a matter which has been theretofore considered only on one occasion.” (Id. at p. 612.) The court distinguished the Crowe Glass case, because there, the court did not consider the effect of the receipt of newly discovered evidence. (Goodrich, at p. 612.) The Goodrich court concluded the successive rehearings the Crowe Glass opinion contemplated would not occur. (Goodrich, at pp. 612–613.) “If the losing party again petitions for a rehearing, that is, a reconsideration of the evidence before the commission, in a case where no new evidence is presented, and it is denied, he cannot again petition for a rehearing, because the commission in such a case is not requested to reconsider new and different evidence.” (Id. at p. 613.) Zozaya v. Workmen’s Compensation Appeals Bd. (1972) 27 Cal.App.3d 464 reached a similar result. The referee, after hearing, concluded the employee’s on-the-job 14. injury caused a permanent disability of 33.25 percent. (Id. at p. 466.) The WCAB granted the employer’s petition for reconsideration, set aside the referee’s decision, and ordered examination by an independent medical examiner. (Ibid.) After the examination, the WCAB adopted the referee’s findings and award as its decision after reconsideration. (Ibid.) The employer filed a second petition for reconsideration, which was granted, resulting in a decision that the employee’s injury caused a permanent disability of 12 percent. (Id. at pp. 466–467.) The court noted “that the filing of the second petition for reconsideration by the employer did not do violence to the rule that an aggrieved party is entitled to but one petition for reconsideration. [Citation.] It is also the rule that where reconsideration is granted and new evidence is considered the appeals board may properly entertain another petition for reconsideration. [Citations.] In such a case the very purpose of the second petition for reconsideration is to have a reconsideration of a matter, i.e., the new evidence, which has theretofore been considered on one occasion.” (Zozaya v. Workmen’s Compensation Appeals Bd., supra, 27 Cal.App.3d at p. 470.) Rea v. Workers’ Comp. Appeals Bd. (2005) 127 Cal.App.4th 625 (Rea) presented this issue in an unusual fact situation. The injured employee’s employer was illegally uninsured for workers’ compensation, so the employee claimed benefits from the Uninsured Employers Fund (Fund). (Id. at pp. 628–629.) The workers’ compensation judge heard the matter, which included issues regarding the identity of the employer. (Id. at p. 634.) The judge entered an award in favor of the employee. The Fund petitioned the WCAB for reconsideration, contending the correct employer had not been served, so there was no jurisdiction to make an award. (Id. at p. 635.) The WCAB affirmed the judge’s award but found the Fund had not assisted in identifying the correct employer for eight years. (Id. at p. 636.) Its decision adopted procedures for the Fund to follow in future cases. (Id. at pp. 636–637.) 15.  The Fund petitioned for reconsideration a second time but did not challenge the sufficiency of the evidence to support the decision. Rather, it contended it was newly aggrieved by the decision on the ground it decided new issues not raised in the prior petition for reconsideration, specifically, the conduct of the Fund that allegedly justified the new procedures and the new procedures themselves. (Rea, supra, 127 Cal.App.4th at pp. 637–638.) The Fund also contended the procedures were void, because they were not enacted in accordance with the Administrative Procedure Act. (Rea, at p. 638.) The WCAB dismissed the second petition for reconsideration, and the Fund petitioned for a writ of review to challenge the decision containing the new procedures. (Ibid.) The court concluded the Fund was newly aggrieved by the decision on the first petition for reconsideration. (Rea, supra, 127 Cal.App.4th at p. 642.) Because the basis for the new procedures was not raised by the parties, and the new procedures were decided for the first time without notice, the second petition for reconsideration was not repetitive and properly requested reconsideration on a matter that had been considered only once. (Ibid.) “If reconsideration is granted and a party is newly aggrieved by the resulting decision within the meaning of sections 5900 and 5903, the party may either petition for reconsideration or [petition for a] writ of review.” (Id. at p. 643.) Because the WCAB had jurisdiction of the second petition for reconsideration, the Fund properly and timely petitioned for a writ of review. (Id. at p. 643.) To summarize, in the analogous workers’ compensation scheme, an aggrieved party is generally entitled to only one petition for reconsideration. However, if a party prevails initially and, on petition for reconsideration by the other party, the decision is reversed, the party who initially prevailed becomes an aggrieved party for the first time and may petition for reconsideration. Alternatively, if reconsideration is granted and new evidence is taken, a second petition for reconsideration may be filed to challenge that decision and its new evidentiary basis. Further, if the decision after the first reconsideration includes matters not raised by the parties, or not appropriate to include in 16. such a decision, a petition for reconsideration may be used to challenge those matters because they could not have been challenged in the first petition for reconsideration. However, if the party who did not prevail initially loses again after reconsideration, and no new evidence was presented on reconsideration, that party cannot petition for reconsideration a second time. Interpreting the similar provisions of CalOSHA in a similar fashion, we conclude none of the circumstances in which a second petition for reconsideration has been allowed is present in this case. Initially, the ALJ ruled against Ventura, upholding the citation and finding a violation of the safety regulation was established. On reconsideration, the Board reached the same result. The Board did not take further evidence but based its decision on the evidence presented at the hearing before the ALJ. Ventura’s second petition for reconsideration did not assert the decision after the first reconsideration raised any issues that were beyond the scope of the issues raised by the parties; Ventura’s second petition for reconsideration, like the first, was based on the claim that the evidence presented before the ALJ did not justify the Board’s findings and decision. In its second petition for reconsideration, Ventura asserted three findings by the Board were factually incorrect: “5. Employer’s plant supervisor, Manuel Sierra (Sierra), was present at the time of the incident, standing atop a platform with direct line of sight of the exposed screw conveyor. [¶] … [¶] “7. Sierra had seen the grates removed from the auger in the past, and had reported the unsafe condition to upper management. [¶] … [¶] “9. With adequate supervision and a thorough inspection of the area, Employer could have known of the existence of the exposed screw conveyor on August 30, 2014.” Findings Nos. 5 and 9 were almost identical to findings made by the ALJ. The ALJ found: “Employer’s foreman, Manuel Sierra (Sierra), was present at the time of the 17. incident, standing atop a platform with direct line of sight of the exposed screw conveyor.” He also found: “With adequate supervision and a thorough inspection of the area, Employer could have known of the existence of the exposed screw conveyor.” Only finding No. 7 was not made by the ALJ. In its second petition for reconsideration, Ventura contended that, based on findings Nos. 5, 7, and 9, the Board concluded Sierra reported the removal of grates to his supervisor, which gave Ventura actual knowledge of the potential danger to employees; therefore, it was not unforeseeable that the grates would be removed again. Further, the Board mentioned a hearsay statement Alvarado attributed to the plant manager, Steve Morrison, that “ ‘they could have avoided it.’ ” The Board concluded the knowledge of Sierra and Morrison was imputed to Ventura, so Ventura could not rebut the presumption of a serious violation by claiming it was unaware that the guarding was sometimes removed. Ventura also took issue with the Board’s conclusion that, from his vantage point, Sierra could have noticed the missing cover and either fixed it or removed the workers from the area. Ventura’s second petition for reconsideration argued factual finding No. 7 was incorrect because Sierra testified he saw the grates lifted on only one occasion, in a completely different area, where there was no employee traffic or access. In a footnote, Ventura made a hearsay objection to Alvarado’s testimony concerning the statement Morrison allegedly made to him, that “ ‘they could have avoided it.’ ” Ventura conceded hearsay evidence was permitted to be used to supplement or explain other evidence (Cal. Code Regs., tit. 8, § 376.2), but objected that the testimony was unreliable and self- serving, and Alvarado’s interpretation of the comment reflected his inadmissible opinion. Ventura now argues that its second petition for reconsideration was proper because Ventura was newly aggrieved by the Board’s decision after reconsideration. It contends it was newly aggrieved by “[t]he Board’s new finding and use of hearsay/opinion testimony.” We disagree. 18.  The Board’s decision after reconsideration reached the same result as the ALJ’s decision. The ALJ’s decision upheld the citation, concluded a serious violation of the safety regulation was established, concluded Ventura failed to establish a Newbery defense, and imposed a modified penalty. The Board’s decision after reconsideration also concluded a serious violation of the safety regulation was established, concluded Ventura failed to establish a Newbery defense, and upheld the ALJ’s modified penalty. Thus, Ventura was the nonprevailing (i.e., aggrieved) party in both decisions. It was not newly aggrieved after reconsideration; it did not prevail initially and lose for the first time after reconsideration. Ventura’s second petition for reconsideration, like its first petition, asked the Board to determine, based on the evidence presented at the hearing before the ALJ, that there was no substantial evidence that Ventura violated the safety regulation, and no substantial evidence that Ventura knew or had reason to know of the violation at the time of Alvarado’s injury. The Board did not take any new evidence on reconsideration. Its decision was based solely on the same evidence presented at the hearing before the ALJ, on which the ALJ’s decision was based. Consequently, Ventura was not challenging for the first time the sufficiency of any new evidence that was not presented at the hearing before the ALJ. It was challenging for the second time the sufficiency of the same evidence to support the same finding that Ventura violated the safety regulation. Ventura also was not newly aggrieved by the Board imposing new rules or new procedures on it, as was the case in Rea. Finally, the Board’s decision after reconsideration did not decide any issues that were beyond the scope of the issues raised by the parties, without giving the parties an opportunity to argue their merits. The Board conducted a routine reconsideration of the ALJ’s decision; it reviewed the evidence presented at the hearing, made its own factual findings, and reached conclusions on the legal issues raised by the parties. Ventura’s second petition for reconsideration raised the same issue as the first: whether the 19. evidence presented at the hearing before the ALJ constituted substantial evidence supporting the findings and conclusions made. Ventura’s argument in the second petition for reconsideration was simply that the Board made one factual finding that the ALJ did not make and used evidence that the ALJ did not mention. Ventura was still aggrieved on the same ground: it believed the evidence did not support the findings and decision. We conclude Ventura was not newly aggrieved by the Board’s decision on reconsideration, and the filing of a second petition for reconsideration was not authorized by statute or case precedent. 3. Waiver of objections Ventura contends its second petition for reconsideration was proper in order to avoid the risk of waiving its objections to the evidence the Board relied on in its decision on reconsideration. “The petitioner for reconsideration shall be deemed to have finally waived all objections, irregularities, and illegalities concerning the matter upon which the reconsideration is sought other than those set forth in the petition for reconsideration.” (§ 6618.)6 The “matter upon which the reconsideration is sought” is the matter presented at the hearing before the ALJ and may encompass the hearing proceeding itself. In the petition for reconsideration, the petitioning party must make any objections to the evidence presented at the hearing that it wishes to make, or the objections are waived. The party petitioning for reconsideration must also raise in the petition any issue of irregularities or illegalities in the hearing proceedings, or those issues are waived. To the extent Ventura sought, in its second petition for reconsideration, to object to hearsay evidence presented at the hearing, the time for those objections had already 6 See also California Code of Regulations, title 8, section 391, which provides in pertinent part: “A petition for reconsideration shall set forth specifically and in full detail the grounds upon which the petitioner considers the order or decision to be unjust or unlawful, and every issue to be considered by the Appeals Board on reconsideration. Any objection or issue not raised in the petition for reconsideration is deemed waived by the petitioner.” 20. passed. If the objections were not made during the hearing before the ALJ or in the original petition for reconsideration, they were already waived before the second petition for reconsideration was filed. The applicable provision states: “The hearing need not be conducted according to technical rules relating to evidence and witnesses. Any relevant evidence shall be admitted if it is the sort of evidence on which responsible persons are accustomed to rely in the conduct of serious affairs, regardless of the existence of any common law or statutory rule which might make improper the admission of such evidence over objection in civil actions. Hearsay evidence may be used for the purpose of supplementing or explaining other evidence but over timely objection shall not be sufficient in itself to support a finding unless it would be admissible over objection in civil actions. An objection to hearsay evidence is timely if made before submission of the case or raised in a petition for reconsideration.” (Cal. Code Regs., tit. 8, § 376.2, italics added.) California Code of Regulations, title 8, section 376.2 and Labor Code section 6618 place on a party who seeks reconsideration the obligation to raise evidentiary objections either at the hearing or in the petition for reconsideration. On reconsideration, the Board is free to make its own findings of fact, based on all of the evidence presented at the hearing before the ALJ. (§ 6621.) Because the party petitioning for reconsideration does not know which evidence the Board will find persuasive, the party must raise all objections it wishes the Board to consider, not just objections to the evidence mentioned in the ALJ’s decision. Ventura concedes the first time it objected to Alvarado’s hearsay testimony regarding Morrison’s statement was in its second petition for reconsideration. It had the opportunity to object to any evidence presented at the hearing, on hearsay or any other grounds, either at the hearing or in its petition for reconsideration. Under section 6618, Ventura’s hearsay objection to Alvarado’s testimony was waived before the second petition for reconsideration was filed, when it was not raised in Ventura’s first petition for reconsideration. Filing a second petition for reconsideration could not revive its right to object, nor could the perceived need to raise objections that had not yet been made 21. validate the filing of a second petition for reconsideration instead of a petition for writ of mandate. 4. Due process violation Ventura contends that, because the Board made a new factual finding to support its decision that Ventura committed a safety violation, it “proceeded on a new and different theory for finding a serious violation without affording Ventura the opportunity to rebut the new finding and object to the hearsay/opinion testimony used in support of its error on reconsideration.” Citing Rucker v. Workers’ Comp. Appeals Bd. (2000) 82 Cal.App.4th 151 (Rucker), Ventura asserts this constituted a due process violation that justified filing a second petition for reconsideration. In Rucker, an injured employee challenged her employer’s failure to pay certain types of compensation and sought penalties for that failure. (Rucker, supra, 84 Cal.App.4th at pp. 153–154.) Most of the issues were resolved before the trial. (Id. at p. 154.) After the trial, the workers’ compensation judge issued an order denying penalties, finding that the employer did not act unreasonably because it acted in reliance on a prior WCAB decision in an unrelated case. (Id. at p. 155.) The employee filed a petition for reconsideration, contending the denial of penalties was not supported by the evidence; she also asserted the order omitted a provision requiring the employer to pay unpaid advances against permanent disability, although the employer admitted at trial that it had not paid any during the period in dispute. The employer did not oppose the petition. (Ibid.) Without further hearing, the workers’ compensation judge modified her order and findings. (Rucker, supra, 82 Cal.App.4th at p. 155.) She found the payment of advances against permanent disability was not in issue because the employee failed to raise the issue; the judge made a factual finding that there was no evidence the employee requested such payments. (Ibid.) The employee filed another petition for reconsideration, presenting evidence that she had requested the payments and had raised the issue prior to 22. trial. (Id. at pp. 155–156.) The WCAB denied the petition for reconsideration, and the employee petitioned the appellate court for review. (Id. at p. 156.) The court concluded there was a due process issue in the case, which “was the result of a failure to read the record prior to rendering a decision that resolved an issue raised on the [workers’ compensation judge’s] own initiative, without affording the parties an opportunity to be heard.” (Rucker, supra, 82 Cal.App.4th at pp. 156–157, italics omitted.) The employer’s defense at the trial had been based on its reliance on a prior case decision, not on the employee’s failure to request advances against permanent disability. The court pointed to entries in the record that demonstrated the employee raised the issue of payment of permanent disability advances multiple times. (Id. at p. 157.) It also pointed out that the employer admitted to not having paid any permanent disability, which included advances against permanent disability. (Ibid.) The employer tacitly admitted the employee requested permanent disability advances. (Ibid.) “Thus, the trial proceeded on a completely different excuse for nonpayment. A [workers’ compensation judge] may not resolve an unaddressed issue without first affording the parties an opportunity to offer rebuttal. [Citations.] The improper restriction on the right to present evidence in rebuttal is a deprivation of the constitutional guaranty of due process of law.” (Ibid.) The court concluded the WCAB should have granted the second petition for reconsideration, because the amended decision of the workers’ compensation judge resulted in a denial of the employee’s due process. (Id. at p. 158.) There was no denial of due process in the decision after reconsideration in this case. The Board decided the same issues that were addressed at the trial and decided initially by the ALJ: whether the Division established that Ventura violated the safety regulation (Cal. Code Regs., tit. 8, § 3999, subd. (a)) by failing to ensure that the screw conveyor was guarded by a substantial cover or grating; whether the Division established a rebuttable presumption that the citation was properly classified as serious; whether Ventura rebutted that presumption by demonstrating it did not know, and could not 23. reasonably have known, of the existence of the violation; and whether the proposed penalty was reasonable. Although the Board made a factual finding concerning Ventura’s knowledge of past removal of the grates that the ALJ did not make, and mentioned hearsay evidence the ALJ did not mention, the same issues were presented in the first and second petitions for reconsideration. Both parties addressed at the hearing whether there was a safety violation and whether Ventura knew or should have known of it; both had an opportunity to present evidence to prove or negate those issues and argued them in post-hearing briefs. Unlike the Rucker case, in this case, no new issue was addressed or decided in the Board’s decision after reconsideration, without input from the parties. Ventura has not established any due process violation in rendering the decision after reconsideration that would justify a second petition for reconsideration. 5. Denial of second petition for reconsideration Ventura asserts it timely filed its second petition for reconsideration (apparently because it was filed within 30 days after the Board filed its decision after reconsideration). It contends the Board failed to act on it within 45 days after the date of filing, and therefore the second petition was denied by operation of law (see § 6624).7 Ventura then filed its petition for writ of mandate within 30 days after the denial by operation of law, so Ventura contends the writ petition was timely. Ventura’s argument assumes its second petition for reconsideration was properly filed. As we have already determined, it was not. A party aggrieved by the Board’s decision after reconsideration must challenge it, if the party challenges it at all, by filing a petition for writ of mandate in the superior court; the exceptions that allow a second petition for reconsideration involve situations in which the party is newly aggrieved by 7 “A petition for reconsideration is deemed to have been denied by the appeals board unless it is acted upon within 45 days from the date of filing. The appeals board may, upon good cause being shown therefor, extend the time within which it may act upon that petition for not exceeding 15 days.” (§ 6624.) 24. the Board’s decision after reconsideration. None of those situations existed in this case. Ventura was aggrieved both by the initial ALJ decision and by the Board’s decision after reconsideration. Its challenge to both decisions was that the evidence presented at the ALJ hearing was not sufficient to support the findings and decision. This is one of the grounds for challenging the decision by petition for writ of mandate. (§ 6629.) Consequently, if Ventura wished to challenge the Board’s decision after reconsideration, its means to do so was by filing a timely petition for writ of mandate in the trial court. Ventura was not permitted to unilaterally grant itself an extension of time to petition the court for a writ of mandate by filing a second petition for reconsideration that raised the same issues as the first, waiting for the 45-day period for Board action to expire, then filing a petition for writ of mandate within 30 days thereafter. Ventura’s argument that it filed a second petition for reconsideration in order to exhaust its administrative remedies is also without merit. Section 6627 expressly authorizes a party to file a petition for writ of mandate within 30 days after a petition for reconsideration is denied or a decision following reconsideration is filed. At that point, the parties’ administrative remedies have been exhausted. 6. Conclusion regarding timeliness We conclude from the foregoing discussion that Ventura’s second petition for reconsideration was not properly filed and had no effect on the timeliness of its petition for writ of mandate. The Board’s decision after reconsideration was filed on September 22, 2017, and Ventura’s time for filing a petition for writ of mandate for review of that decision expired 31 days thereafter, on October 23, 2017 (because October 22 fell on a Sunday). Its petition for writ of mandate was not filed until December 15, 2017. The trial court properly concluded from the face of the pleading and the date of filing that the petition was not timely filed. It did not err in granting the Board’s motion for judgment on the pleadings. 25. III. Equitable Tolling A. The Saint Francis decision After briefing in this case was complete, Ventura requested leave to file supplemental briefing to discuss the effect of a newly issued Supreme Court opinion (Saint Francis, supra, 9 Cal.5th 710 ) on the issue of the timeliness of its writ petition. We granted the request, and all parties filed supplemental briefs. In Saint Francis, the court considered whether the doctrine of equitable tolling applied to the time period set out in Government Code section 11523, which governs the time for filing a petition for writ of administrative mandate to obtain judicial review of the decision of an administrative agency, when there are no more specific statutory provisions applicable to the agency. (Saint Francis, supra, 9 Cal.5th at pp. 716–717.) There, the State Department of Public Health (department) had imposed a fine on the hospital for a regulatory violation; the ALJ found in favor of the hospital. (Id. at p. 717.) The department reversed the ALJ’s decision. (Ibid.) The department’s decision stated it was effective immediately. Two weeks later, the hospital filed a request for reconsideration, which was ordinarily allowed “within ‘30 days after the delivery or mailing of a decision to a respondent.’ ” (Id. at p. 718, citing Gov. Code, § 11521, subd. (a).) The department denied the request for reconsideration, however, explaining that, because its decision was effective immediately, reconsideration was not allowed. (Saint Francis, at p. 719.) Eleven days after that denial, but 41 days after service of the department’s final decision, the hospital petitioned for a writ of administrative mandate in the superior court. The trial court sustained the department’s demurrer to the writ petition on the ground it was untimely; under Government Code section 11523, the writ petition was required to be filed “ ‘within 30 days after the last day on which reconsideration can be ordered.’ ” (Saint Francis, at p. 719, citing Gov. Code, § 11523.) Since reconsideration was not allowed when a decision was effective immediately, the 26. writ petition was untimely if it was not filed within 30 days after service of the department’s decision. (Ibid.) The court concluded that, in appropriate circumstances, equitable tolling could be applied to the time period set out in Government Code section 11523. “Equitable tolling is a ‘judicially created, nonstatutory doctrine’ that ‘ “suspend[s] or extend[s] a statute of limitations as necessary to ensure fundamental practicality and fairness.” ’ [Citation.] The doctrine applies ‘occasionally and in special situations’ to ‘soften the harsh impact of technical rules which might otherwise prevent a good faith litigant from having a day in court.’ [Citation.] Courts draw authority to toll a filing deadline from their inherent equitable powers—not from what the Legislature has declared in any particular statute. [Citation.] For that reason, we presume that statutory deadlines are subject to equitable tolling.” (Saint Francis, supra, 9 Cal.5th at pp. 719–720.) The presumption is rebuttable. “A court may conclude that explicit statutory language or a manifest policy underlying a statute simply cannot be reconciled with permitting equitable tolling, ‘even in the absence of an explicit prohibition.’ ” (Id. at p. 720.) The court considered the language of Government Code section 11523, the length of the period it allowed for filing the writ petition, any statutory exceptions to the time limit on filing, and the legislative history of the statute. (Saint Francis, supra, 9 Cal.5th at pp. 720–724.) It concluded that equitable tolling of the statute was available, as a narrow remedy that applied only occasionally and in special situations, when justice and fairness demanded the limitations period be tolled. (Id. at pp. 723–724.) The court identified three elements that must be present in order for equitable tolling to apply: “ ‘[(1)] timely notice, and [(2)] lack of prejudice, to the defendant, and [(3)] reasonable and good faith conduct on the part of the plaintiff.’ ” (Saint Francis, supra, 9 Cal.5th at p. 724.) The court concluded the first element was met: before the hospital’s time for filing a writ petition had expired, it both filed a petition for reconsideration and informed the department that it intended to file a writ petition if its 27. petition for reconsideration was unsuccessful. (Id. at p. 727.) The court noted the department’s attorney had also agreed with the hospital’s understanding of the date the petition for reconsideration was due. (Id. at pp. 718, 727.) The court found the second element was also met. The focus of the prejudice analysis is on “whether application of equitable tolling would prevent the defendant from defending a claim on the merits.” (Saint Francis, supra, 9 Cal.5th at p. 728.) The department had defended its assessment of the penalty throughout the administrative proceedings, so the court could not see how tolling the time period would undermine its ability to defend the propriety of the penalty in court. (Ibid.) The court interpreted the third element to require both objective reasonableness— that the party’s actions were fair, proper, and sensible in light of the circumstances—and subjective good faith—denoting honesty of purpose, freedom from intention to defraud, and being faithful to one’s duty or obligation. (Saint Francis, supra, 9 Cal.5th at p. 729.) Because the Court of Appeal had not determined whether that element was met, the court remanded the case for it to make that determination. (Id. at p. 730.) B. Leave to amend The Board’s motion for judgment on the pleadings was made on the ground Ventura’s petition for writ of mandate was not timely filed. The face of the pleading revealed the petition was not timely filed and the trial court did not err in granting the motion. Ventura now argues that its late filing may be excused on the ground of equitable tolling, under principles set out in Saint Francis. Equitable tolling was not pled in the petition, however. Accordingly, we will treat Ventura’s contention as an argument that it should be permitted to amend its pleading to allege facts supporting equitable tolling of the limitations period, to avoid the bar of untimely filing. “A trial court has wide discretion to allow the amendment of pleadings, and generally courts will liberally allow amendments at any stage of the proceeding.” (Falcon v. Long Beach Genetics, Inc. (2014) 224 Cal.App.4th 1263 , 1280.) A “ ‘motion 28. for judgment on the pleadings is analogous to a general demurrer.’ ” (Ludgate Ins. Co. v. Lockheed Martin Corp. (2000) 82 Cal.App.4th 592 , 602.) “ ‘In the case of either a demurrer or a motion for judgment on the pleadings, leave to amend should be granted if there is any reasonable possibility that the plaintiff can state a good cause of action.’ ” (Gami v. Mullikin Medical Center (1993) 18 Cal.App.4th 870 , 876 (Gami).) The plaintiff has the burden of showing what amendment can be made, and how it will change the legal effect of the pleading, so that it states a cause of action. (Smith v. State Farm Mutual Automobile Ins. Co. (2001) 93 Cal.App.4th 700 , 711.) A plaintiff can even make this showing for the first time on appeal. (Ibid.) Denial of leave to amend is reviewed for abuse of discretion. (Hernandez v. City of Pomona (1996) 49 Cal.App.4th 1492 , 1497.) “Where a demurrer is sustained or a motion for judgment on the pleadings is granted as to the original complaint, denial of leave to amend constitutes an abuse of discretion if the pleading does not show on its face that it is incapable of amendment.” (Gami, supra, 18 Cal.App.4th at p. 877.) Ventura asserts that the time period in issue in this case is subject to equitable tolling, like the time period addressed in Saint Francis. Further, it asserts facts making the doctrine applicable exist in this case. Whether the proposed amendment is viable as a means of curing the defect in the existing pleading depends upon whether equitable tolling may apply to extend the time limit for filing a petition for writ of mandate in the superior court to challenge the administrative decision of the Board. Consequently, we must determine whether the time limitation expressed in section 6627 is the type of limit that is subject to equitable tolling. C. Application of equitable tolling to section 6627 Ventura contends the limitations period set out in section 6627, which applies to judicial review of decisions of the Board, is a statute of limitations subject to equitable tolling, just as Government Code section 11523 was held to be in Saint Francis. The 29. Board and the Division contend section 6627 is a jurisdictional time limit and, as such, cannot be extended by the court through equitable tolling. In Elkins v. Derby (1974) 12 Cal.3d 410 (Elkins), the court addressed a “matter of first impression concerning whether the statute of limitations on a plaintiff’s personal injury action is tolled for the period during which he pursues his workmen’s compensation remedy against defendant.” (Id. at p. 412.) The plaintiff had been injured while working at the defendants’ business. He filed an application for workers’ compensation benefits, but it was denied on the ground he was not an employee at the time of his injury. (Id. at p. 413.) The plaintiff filed his civil action against the defendants about a month after receiving the final workers’ compensation decision. The trial court sustained the defendants’ demurrer on the ground the plaintiff’s action was barred by the statute of limitations. (Ibid.) The reviewing court reversed, following “a line of relatively recent California cases which points toward the principle that regardless of whether the exhaustion of one remedy is a prerequisite to the pursuit of another, if the defendant is not prejudiced thereby, the running of the limitations period is tolled ‘[w]hen an injured person has several legal remedies and, reasonably and in good faith, pursues one.’ ” (Elkins, supra, 12 Cal.3d at p. 414.) The court concluded suspension of the running of the limitations period would not frustrate achievement of the primary purposes of the limitations statute: “to ‘[prevent] surprises through the revival of claims that have been allowed to slumber until evidence has been lost, memories have faded, and witnesses have disappeared.’ ” (Id. at p. 417.) The employer would not be prejudiced by failure to gather evidence, if it was notified of the employee’s claim by the workers’ compensation proceeding. (Id. at pp. 417–418.) Further, the employee should not be required to make duplicate filings when in doubt about which remedy applies. (Id. at p. 419.) In Addison v. State of California (1978) 21 Cal.3d 313 (Addison), the court concluded the filing of a civil action in federal court suspended the running of the six- 30. month limitations period for filing an action against a public entity in state court. Claims against public entities were required to be presented to the appropriate agency within a specified time, and, if rejected, the claimant had six months to bring a court action. (Id. at p. 316.) The plaintiffs filed timely claims, which were rejected. (Id. at p. 317.) Three and one-half months later, they filed an action in federal court alleging federal and state claims. The defendants’ motion to dismiss for lack of federal jurisdiction was granted; the plaintiffs filed a similar action in state court, even before the dismissal was granted. (Ibid.) In state court, the defendants’ demurrer on statute of limitations grounds was sustained. (Ibid.) Although “[i]t has been held that ‘The prescribed statutes of limitations for commencement of actions against the state “are mandatory and must be strictly complied with,” ’ ” the court concluded, “occasionally and in special situations, the foregoing statutory procedure does not preclude application of the equitable tolling doctrine, the purpose of which is to soften the harsh impact of technical rules which might otherwise prevent a good faith litigant from having a day in court.” (Addison, supra, 21 Cal.3d at p. 316.) The court followed the rule set out in Elkins and held that “application of the doctrine of equitable tolling requires timely notice, and lack of prejudice, to the defendant, and reasonable and good faith conduct on the part of the plaintiff.” (Addison, at p. 319.) “As with other general equitable principles, application of the equitable tolling doctrine requires a balancing of the injustice to the plaintiff occasioned by the bar of his claim against the effect upon the important public interest or policy expressed by the … limitations statute.” (Id. at p. 321.) The defendants had notice of the plaintiffs’ claims, and any delay from the erroneous choice of forum was minimal. (Ibid.) Denial of tolling would deny the plaintiffs a hearing on the merits of their claim. (Ibid.) The court found the balance favored the plaintiffs. It reversed and remanded with directions to overrule the demurrer. (Ibid.) 31.  Equitable tolling has not been applied to the time limit for filing a civil appeal. In Estate of Hanley (1943) 23 Cal.2d 120 , the court considered the timeliness of an appeal from an order settling the account of an executrix, to which a 60-day time limit applied. (Id. at p. 122.) It stated: “the requirement as to the time for taking an appeal is mandatory, and the court is without jurisdiction to consider one which has been taken subsequent to the expiration of the statutory period.” (Ibid.) “In the absence of statutory authorization, neither the trial nor appellate courts may extend or shorten the time for appeal [citation], even to relieve against mistake, inadvertence, accident, or misfortune [citations]. Nor can jurisdiction be conferred upon the appellate court by the consent or stipulation of the parties, estoppel, or waiver. [Citations.] If it appears that the appeal was not taken within the 60-day period, the court has no discretion but must dismiss the appeal of its own motion even if no objection is made.” (Id. at p. 123, italics added.) The court explained the reason for this rule: “In strictly adhering to the statutory time for filing a notice of appeal, the courts are not arbitrarily penalizing procedural missteps. Relief may be given for excusable delay in complying with many provisions in the statutes and rules on appeal, such as those governing the time within which the record and briefs must be prepared and filed. These procedural time provisions, however, become effective after the appeal is taken. The first step, taking of the appeal, is not merely a procedural one; it vests jurisdiction in the appellate court and terminates the jurisdiction of the lower court. And of particular importance is the fact that the security of rights of contract, titles to property, and the status of persons rest upon certainty in the finality of judgments occasioned by the lapse of the statutory time for the taking of an appeal.” (Estate of Hanley, supra, 23 Cal.2d at pp. 123–124.) In Hollister Convalescent Hosp., Inc. v. Rico (1975) 15 Cal.3d 660 , the defendants’ notice of appeal of the judgment in a civil action was filed one day late. The court cited a rule of court authorizing the reviewing court, for good cause, to relieve a party from a default in failing to comply with the rules, “ ‘except the failure to give timely 32. notice of appeal.’ ” (Id. at p. 666, citing former Cal. Rules of Court, rule 45(e).)8 The court then reiterated the reason for the rule, as set out in Estate of Hanley, and the jurisdictional nature of a timely notice of appeal. (Hollister Convalescent Hosp., Inc., at p. 666.) Because the notice of appeal was untimely, the appeal was dismissed. (Id. at p. 675.) Thus, an ordinary statute of limitations governing the time for filing a pleading initiating an action is subject to the equitable tolling doctrine. The time for filing appeals in conventional civil actions is not. “ ‘Compliance with the time for filing a notice of appeal is mandatory and jurisdictional.’ ” (Conservatorship of Townsend (2014) 231 Cal.App.4th 691 , 700.) Absent statutory authorization to extend the jurisdictional period, if the notice of appeal is not actually or constructively filed within the appropriate filing period, an appellate court is without jurisdiction to determine the merits of the appeal and must dismiss it. (Id. at pp. 700, 701.) “ ‘The purpose of this requirement is to promote the finality of judgments by forcing the losing party to take an appeal expeditiously or not at all.’ ” (Id. at p. 700.) Whether the time for filing a writ petition in court to obtain review of an administrative decision is jurisdictional or subject to extension by the court has been less clear. Government Code section 11523 contains general provisions for seeking review of administrative adjudications. It provides: “Judicial review may be had by filing a petition for a writ of mandate in accordance with the provisions of the Code of Civil Procedure, subject, however, to the statutes relating to the particular agency.” (Gov. Code, § 11523.) The petition must be filed “within 30 days after the last day on which reconsideration can be ordered.” (Ibid.) However, “[i]f the petitioner, within 10 days after the last day on which reconsideration can be ordered, requests the agency to prepare 8 See now California Rules of Court, rule 8.104(b): “Except as provided in [California Rules of Court, ]rule 8.66, no court may extend the time to file a notice of appeal. If a notice of appeal is filed late, the reviewing court must dismiss the appeal.” 33. all or any part of the record, the time within which a petition may be filed shall be extended until 30 days after its delivery to him or her.” (Ibid.) In Ginns v. Savage (1964) 61 Cal.2d 520 , the Real Estate Commissioner (commissioner), after notice and a hearing, revoked the plaintiff’s license as a real estate broker. (Id. at pp. 521–522.) The commissioner issued a decision, which stated it was effective October 2, 1961. The plaintiff filed her petition for writ of mandate to challenge the decision on November 3, 1961, two days late. (Id. at p. 522.) The commissioner demurred to the petition on the ground the time limits set out in Government Code section 11523 were jurisdictional and the plaintiff had not complied with them. The court stated: “The law is settled, and clear, that the statutory periods within which mandamus petitions may be filed are not jurisdictional in nature, as are the periods within which appeals may be taken from lower courts [citation], but are mere statutes of limitation.” (Ginns, at p. 524.) The plaintiff had attempted to allege that the delay was induced by the representation of the commissioner’s attorney that the deadline for filing her petition was November 3, 1961. (Id. at p. 523.) The court reversed the dismissal and directed that the plaintiff be granted leave to amend her petition to allege the misrepresentation. (Id. at p. 526.) In Pressler v. Donald L. Bren Co. (1982) 32 Cal.3d 831 (Pressler), the Supreme Court suggested the opposite. There, an employee made a claim against his former employer for compensation owed. (Id. at p. 833.) After an informal administrative hearing (see § 98, subd. (a)), the Labor Commissioner issued a decision in the employee’s favor. (Pressler, at p. 833.) The employer filed a notice of appeal in the superior court 13 days later. (Ibid.) The employee moved to dismiss the appeal because the notice of appeal was not filed within the 10-day statutory time period (see § 98.2, subd. (a)). (Pressler, at p. 834.) The court noted that, in conventional appeals, timely notice of appeal is an absolute prerequisite to appellate jurisdiction. (Pressler, supra, 32 Cal.3d at p. 835.) 34. Although an appeal from a Labor Commissioner decision differs from a conventional appeal because it is heard de novo, the statutory framework “clearly demonstrates the mandatory and jurisdictional nature of the requirement that a party notice his or her appeal within 10 days. The timely filing of the notice of appeal (1) forestalls the finality of the Labor Commissioner’s decision; (2) terminates the jurisdiction of the Labor Commissioner; and (3) vests jurisdiction to conduct a trial de novo in the appropriate court.” (Id. at p. 836.) Public policy favors full and prompt payment of wages due to an employee, and requiring strict adherence to the time requirement for such appeals helps assure achievement of this overriding goal. (Id. at p. 837.) The court also noted “that neither mistake, surprise, nor excusable neglect will excuse, for example, the late filing of a petition to review a determination of the [WCAB] [citation] or of the Agricultural Labor Relations Board [citation]. Nor may a court extend the time for filing a petition for writ of mandate to review the decision of an administrative agency whose proceedings are governed by the Administrative Procedure Act based on mistake, inadvertence or other such excuse.” (Ibid.) The court affirmed the dismissal of the late-filed appeal. (Id. at p. 838.) In Elliott v. Contractors’ State License Bd. (1990) 224 Cal.App.3d 1048 (Elliott), a contractor filed a petition for a writ of mandate to review the administrative decision revoking his contractor’s license. (Id. at p. 1051.) Under Government Code section 11523, the contractor had 30 days from the effective date of the administrative decision within which to file his writ petition; he filed it two months late. (Elliott, at p. 1052.) The court noted: “The time within which a party must institute judicial review of administrative action is generally held to be jurisdictional.” (Ibid.) Nonetheless, the court considered and rejected application of the rule that “[a] defendant is estopped to assert the statute of limitations if its conduct caused the plaintiff to delay filing the action.” (Elliott, supra, 224 Cal.App.3d at p. 1053.) The agency had not affirmatively misled the contractor about the filing time. (Ibid.) The court also 35. rejected the argument that late filing of the writ petition was a mere technical noncompliance with the statute of limitations. “Under certain circumstances, technical noncompliance with nonjurisdictional filing requirements will not cause a petition to be deemed untimely filed.” (Ibid.) In those cases, however, the party timely submitted the petition and the clerk rejected it based on nonjurisdictional defects in the form of the petition. The contractor in Elliott had not timely submitted his petition. (Id. at pp. 1053– 1054.) The general procedures for filing a writ petition to review an administrative decision are “subject … to the statutes relating to the particular agency.” (Gov. Code, § 11523.) Various administrative agencies are governed by their own procedures and their own statutory time limits. Appeals from decisions of the WCAB are governed by the time limits in section 5950. In Camper v. Workers’ Comp. Appeals Bd. (1992) 3 Cal.4th 679 (Camper), the Supreme Court observed: “[I]t is now too well established to question that the time limitation set forth in Labor Code section 5950 is jurisdictional.” (Id. at p. 686; accord, Malloy v. Workers’ Comp. Appeals Bd. (1991) 1 Cal.App.4th 1658 , 1559–1660; Southwest Airlines v. Workers’ Comp. Appeals Bd. (1991) 234 Cal.App.3d 1421 , 1424.) With little or no analysis, other courts have concluded the time for filing petitions for review of other administrative decisions is also jurisdictional. This includes the time for seeking judicial review of decisions of the Agricultural Labor Relations Board under section 1160.8 (Mario Saikhon, Inc. v. Agricultural Labor Relations Bd. (1983) 140 Cal.App.3d 581 , 582; United Farm Workers v. Agricultural Labor Relations Board (1977) 74 Cal.App.3d 347 , 350) and decisions of the Public Employment Relations Board pursuant to Government Code section 3542 (San Mateo Federation of Teachers v. Public Employment Relations Bd. (1994) 28 Cal.App.4th 150 , 155). It also includes the time for seeking review of a penalty imposed for failure to maintain workers’ compensation insurance under section 3725 (Department of Industrial Relations v. Atlantic Baking Co. (2001) 89 Cal.App.4th 891 , 895). 36.  The time for filing a petition for writ of mandate to review decisions of the Board is set out in section 6627. In Raam Construction, Inc. v. Occupational Safety & Health Appeals Bd. (2018) 28 Cal.App.5th 709 (Raam), the court held that Code of Civil Procedure section 1013 did not extend the time period in Labor Code section 6627. Code of Civil Procedure section 1013 provides that “any right or duty to do any act … within any period … after service of the document, which time period … is prescribed by statute or rule of court, shall be extended five calendar days, upon service by mail” within the state. (Code Civ. Proc., § 1013, subd. (a).) The Raam court concluded section 6627, by its unambiguous language, mandated that the application for a writ of mandate be made within 30 days after the petition for reconsideration was denied, or the decision after reconsideration was filed. (Raam, at pp. 713–714.) The time period did not run from service of any document, so Code of Civil Procedure section 1013 did not apply. (Raam, at pp. 714–715.) Raam cited Camper, which reached the same conclusion about the language of section 5950. (Raam, at pp. 714–715) The Raam court opined that section 5950 was “in all significant respects identical to section 6627,” and “the language of section 5950 mirrors that of section 6627.” (Raam, at p. 714.) Unlike Camper, however, Raam did not go farther and conclude the time period set out in the statute was jurisdictional, as an additional reason for finding Code of Civil Procedure section 1013 did not apply. We have not found, and the parties have not directed us to, any case in which a court held the time period in section 6627 is jurisdictional or not subject to equitable tolling. In Saint Francis, the court did not mention or discuss cases holding that the time for filing an appeal in a civil action, or the time for filing a petition for judicial review of certain administrative decisions, is jurisdictional and not subject to extension by the court. The court defined equitable tolling as “a ‘judicially created, nonstatutory doctrine’ that ‘ “suspend[s] or extend[s] a statute of limitations as necessary to ensure fundamental practicality and fairness.” ’ ” (Saint Francis, supra, 9 Cal.5th at p. 719, italics added.) 37. Throughout its decision the court referred to Government Code section 11523 as a “statute of limitations,” and “presume[d] that statutory deadlines are subject to equitable tolling.” (Saint Francis, at p. 720.) That presumption could be overcome by “explicit statutory language or a manifest policy underlying a statute [that] simply cannot be reconciled with permitting equitable tolling.” (Ibid.) In determining whether the presumption was rebutted, the Saint Francis court considered the statute’s language and structure, the length of the time period for filing, whether tolling provisions in the statute were made exclusive, and whether the legislative history of the statute indicated an intent to preclude equitable tolling. Government Code section 11523, which was construed in Saint Francis, does not apply to the Board’s decision because its decision is governed by “statutes relating to the particular agency.” (Gov. Code, § 11523; see § 6300 et seq.) Section 6615 provides that “[n]o cause of action arising out of any final order or decision made and filed by the appeals board or a hearing officer shall accrue in any court” until the party’s petition for reconsideration has been granted or denied, or the Board has reconsidered the decision on its own motion. (§ 6615.) This provision is consistent with the characterization of the time limit in section 6627 as a statute of limitations. The writ proceeding is based on a cause of action that accrues when reconsideration is denied or a decision after reconsideration is filed, and it must be commenced within the limitations period set out in section 6627. The writ proceeding is not treated as an appeal to which a jurisdictional time limit would apply. We apply the analysis used in Saint Francis to determine whether the presumption that the statute of limitations is subject to equitable tolling has been rebutted. First, we consider the language of the statute. There is no explicit statutory language indicating the time limit set out in section 6627 is not subject to equitable tolling. Section 6627 provides that a person affected by a decision of the Board “may, within the time limit specified in this section,” apply for a writ of mandate to review the decision. “The 38. application for writ of mandate must be made within 30 days after a petition for reconsideration is denied, or, if a petition is granted or reconsideration is had on the appeals board’s own motion, within 30 days after the filing of the order or decision following reconsideration.” (§ 6627.) “Although the statute—like all statutes of limitations—sets forth a deadline by which writ petitions must be filed, its language and structure is no different from that of other statutes of limitations that are subject to equitable tolling.” (Saint Francis, supra, 9 Cal.5th at p. 720.) The statute in Saint Francis, which was subject to equitable tolling, provided that a “petition for a writ of mandate ‘shall be filed within 30 days after the last day on which reconsideration can be ordered.’ ” (Ibid.) Other statutes subject to equitable tolling have provided that “ ‘[n]o [Department of Fair Employment and Housing] complaint may be filed after the expiration of one year from the date upon which the alleged unlawful practice … occurred’ ” (McDonald v. Antelope Valley Community College Dist. (2008) 45 Cal.4th 88 , 106, citing Gov. Code, former § 12960, subd. (d)); that the “ ‘right … to seek judicial review from an appeals board decision shall be exercised not later than six months after the date of the decision of the appeals board’ ” (Tarkington v. California Unemployment Ins. Appeals Bd. (2009) 172 Cal.App.4th 1494 , 1502, fn. 6, citing Unemp. Ins. Code, § 410); and that any suit against a public entity for which claim presentation was required “must be commenced … [¶] … not later than six months after the date” notice of denial of the claim was given (Gov. Code, § 945.6, subd. (a)(1); see Addison, supra, 21 Cal.3d at p. 316). Like these provisions, section 6627 imposes a deadline, but contains no language expressly or implicitly precluding application of equitable tolling. In contrast, the workers’ compensation scheme contains such limiting language. Section 5950 provides, similarly to section 6627, that any person affected by the decision of the WCAB “may, within the time limit specified in this section,” apply for a writ to review the decision, and the application “must be made within 45 days after a petition for reconsideration is denied, or, … within 45 days after the filing of the order, decision, or 39. award following reconsideration.” (§ 5950.) Section 5810, however, provides: “The orders, findings, decisions, or awards of the appeals board made and entered under this division may be reviewed by the courts specified in Sections 5950 to 5956 within the time and in the manner therein specified and not otherwise.” (§ 5810, italics added.) CalOSHA does not contain a similar provision, limiting judicial review to writ proceedings filed “within the time … specified and not otherwise.” Next, we consider the length of the limitations period. The 30-day limitations period of section 6627, like the 30-day limitations period in Saint Francis, is not “ ‘so “exceptionally long” ’ that it ‘indicates the Legislature’s effort to provide, within the strict statutory period itself, a reasonable time to’ file suit.” (Saint Francis, supra, 9 Cal.5th at p. 720.) Rather, it is “relatively brief, so it carries with it no such inference.” (Ibid.) Section 6627 does not contain any provisions tolling, delaying, or extending the limitations period. Consequently, we need not consider whether any such provisions were intended as the exclusive occasions for extending the statutory time period. Finally, the legislative history of section 6627 does not suggest the Legislature intended to preclude the application of equitable tolling.9 Section 6627 was enacted as part of CalOSHA in 1973 (Stats. 1973, ch. 993, § 101, p. 1950) and has not been amended since. CalOSHA was intended to conform California law to the requirements of the federal Occupational Safety and Health Act of 1970 ( 29 U.S.C. § 651 et seq). (Assem. Com. on Labor Relations, Analysis of Assem. Bill No. 150 (1973–1974 Reg. Sess.) as amended Apr. 12, 1973, p. 1.) The legislative history contains little mention of the provisions for judicial review of the Board’s decision, and no discussion of the time period for seeking such review. The initial version of the proposed act contained 9 Simultaneously with the filing of its first supplemental brief, Ventura filed a request for judicial notice of certain documents from the legislative history of the enactment of section 6627. We grant the unopposed request. 40. proposed section 6612, which provided that decisions “may be reviewed by the Supreme Court and the courts of appeal within the time and in the manner specified in this chapter.” (Assem. Bill No. 150 (1973–1974 Reg. Sess.) as introduced Jan. 23, 1973, § 10, ch. 4, p. 27.) The chapter, however, contained no provisions for the time and manner for review of decisions. (Id. at pp. 24–27.) A subsequent version of the proposed act contained proposed section 6627, similar to the workers’ compensation review statute, providing for review by petitioning the Supreme Court or a court of appeal for a writ of review. (Assem. Amend. to Assem. Bill No. 150 (1973–1974 Reg. Sess.) Apr. 12, 1973, § 38, ch. 7, p. 49.) Proposed section 6627 was later amended to its final version, which provided for review by petitioning the superior court for a writ of mandate. (Sen. Amend. to Assem. Bill No. 150 (1973–1974 Reg. Sess.) Aug. 28, 1973, § 101, ch. 7, p. 55.) Once it was added, the 30-day time provision for applying for a writ seeking review of the Board’s decision remained unchanged throughout. Nothing in the legislative history indicates the Legislature intended the 30-day period to be an absolute limit, not subject to equitable tolling. We conclude the time period set forth in section 6627 for filing a petition for writ of mandate to review the Board’s decision after reconsideration is a statute of limitations, subject to the doctrine of equitable tolling. D. Application of equitable tolling in this case The parties invite us to determine that equitable tolling either does or does not excuse Ventura’s late filing of its petition for writ of mandate in the trial court. The issue before us, however, is whether judgment on the pleadings was properly granted and the writ petition was properly dismissed because the petition showed on its face that it was barred by the statute of limitations. The face of the petition shows the Board issued its decision after reconsideration on September 22, 2017, and Ventura’s petition seeking judicial review of that decision was not filed until December 15, 2017, well over 30 days thereafter. 41.  The petition did not allege any facts raising the issue of equitable tolling, and the parties did not present evidence or argument in the trial court to establish or negate its application in this case. The requirements for its application present questions of fact that have not yet been addressed by the trial court. This includes questions regarding whether the conduct of Ventura, the reason for its delay in filing the petition, and the length of the delay were reasonable and in good faith. Additionally, if tolling is appropriate, the trial court must determine the length of the tolling period and whether the petition was timely filed, in light of any tolling period that is allowed. The trial court must also address the issues of notice and prejudice to the Board. Accordingly, we do not determine on the merits whether equitable tolling is appropriate in this case, or whether the writ petition was timely filed if tolling is allowed. We conclude that, while the trial court properly granted judgment on the pleadings, the Board’s motion for judgment on the pleadings addressed Ventura’s original petition, and “denial of leave to amend constitutes an abuse of discretion if the pleading does not show on its face that it is incapable of amendment.” (Gami, supra, 18 Cal.App.4th at p. 877.) Ventura has demonstrated that it may be able to amend to allege equitable tolling of the statute of limitations, and we cannot conclude its pleading incapable of amendment to cure the defect. Accordingly, we reverse the judgment and remand to the trial court to permit Ventura to amend its petition to allege facts supporting its claim of equitable tolling. 42.  DISPOSITION The judgment is reversed. The trial court is directed to vacate its order granting dismissal of Ventura’s petition for writ of mandate, and to enter a new order granting the Board’s motion for judgment on the pleadings with leave to amend to allege facts supporting the claim of equitable tolling. Ventura is entitled to its costs on appeal. HILL, P.J. WE CONCUR: PEÑA, J. MEEHAN, J. 43.

2020-12-01 23:03:57.072611+00

http://www.illinoiscourts.gov/Opinions/AppellateCourt/2020/2ndDistrict/2190959.pdf

2020 IL App (2d) 190959 No. 2-19-0959 Opinion filed December 1, 2020 ______________________________________________________________________________ IN THE APPELLATE COURT OF ILLINOIS SECOND DISTRICT ______________________________________________________________________________ LANCE PACERNICK, ) Appeal from the Circuit Court ) of Lake County. Plaintiff-Appellant, ) ) v. ) No. 19-MR-49 ) THE BOARD OF EDUCATION OF THE ) WAUKEGAN COMMUNITY UNIT ) SCHOOL DISTRICT NO. 60, THE ILLINOIS ) STATE BOARD OF EDUCATION, and ) LISA SALKOVITZ KOHN, Not in Her ) Individual Capacity, ) ) Defendants, ) ) (The Board of Education of the Waukegan ) Honorable Community Unit School District No. 60, ) David P. Brodsky, Defendant-Appellee). ) Judge, Presiding. ______________________________________________________________________________ JUSTICE JORGENSEN delivered the judgment of the court, with opinion. Justices Hutchinson and Schostok concurred in the judgment and opinion. OPINION ¶1 Plaintiff, Lance Pacernick, appeals from the trial court’s order denying his complaint for administrative review in which he sought the reinstatement of his employment as a tenured teacher at Waukegan High School (WHS). Plaintiff was the coach of the girls’ track team at the school and members of the team made allegations that plaintiff made sexual and other inappropriate comments to them, invaded their personal space, leered at them, touched at least four of them on  2020 IL App (2d) 190959 their buttocks, and caused them emotional distress. Pursuant to the school district (district) administration’s recommendation, defendant, the Board of Education of Waukegan Community Unit School District No. 60 (Board), voted to terminate plaintiff’s employment. After a hearing before a hearing officer of the Illinois State Board of Education, who recommended that plaintiff be dismissed for irremediable conduct, the Board adopted the officer’s recommendation and dismissed plaintiff. On administrative review, the trial court denied plaintiff’s complaint. On appeal, plaintiff argues that (1) the Board’s dismissal determination was erroneous where it found that plaintiff sexually harassed members of the track team and that his conduct was irremediable and (2) the Board did not strictly comply with the procedures for dismissing a tenured teacher for cause where it never approved a motion with specific charges and did not timely mail to plaintiff a notice of the charges and a bill of particulars. We affirm. ¶2 I. BACKGROUND ¶3 Plaintiff began working for the school district during the 2002-03 school year. Between January 19, 2014, and March 22, 2017, he served as the head coach of both the WHS girls’ track team and the boys’ cross-country team, in addition to teaching English The school has two campuses and serves 4000 students. ¶4 During his tenure as coach, the girls track team had about 50 members, freshmen through seniors. The indoor track season ran from January to March, and the outdoor season ran from March to May. During the seasons, the girls practiced after school every day and on Saturdays. Track meets occurred once or twice per week. Most of the girls on the track team are Hispanic. ¶5 On Friday, March 17, 2017, at a track meet in Wisconsin, S.W., a member of the WHS girls track team, reported to Beatrice J., the grandmother of one of her teammates, that plaintiff had touched some of the girls on their buttocks and that she had informed Sam Taylor, the athletic -2-  2020 IL App (2d) 190959 director, of this, but he had done nothing. Beatrice reported this to Christine Zucker, a teacher at WHS who was at the meet as a coach for another school. The following Monday, March 20, 2017, Zucker began contacting several district administrators. ¶6 A. Investigation and Board’s Dismissal Decision ¶7 An investigation was conducted between March 22, 2017, and April 21, 2017, and included interviews of all the girls on the track team. Also, on March 22, 2017, a due-process meeting was held with plaintiff and his union representative, and plaintiff was placed on paid administrative leave pending the investigation. ¶8 On April 14, 2017, a second due-process meeting was held with plaintiff and his union representative, and plaintiff was informed of, and denied, the allegations. On April 19, 2017, plaintiff submitted a written statement denying the allegations. He was provided redacted statements from 48 students. On April 19, 2017, plaintiff’s dismissal was recommended to the superintendent, who approved its presentation to the Board. On April 21, 2017, a third due-process meeting was held with plaintiff, and he was informed that his dismissal would be recommended to the Board. ¶9 Sadara DeVonne, the Board’s employee relations director and Equal Employment Opportunity (EEO) and Title IX coordinator, headed the investigation. Lori Massimo, a high school campus director, assisted DeVonne. Both DeVonne and Massimo are trained investigators, including in the district’s antiharassment policies. (Plaintiff had received training on the Board’s antiharassment policies.) Massimo interviewed each student on the track team and asked her to prepare a written statement. DeVonne conducted second interviews with several students after reading their statements. Ultimately, 48 current and former students (ages 14 to 19 years old) were interviewed. Four students reported unwelcomed touching on their buttocks; 7 reported receiving -3-  2020 IL App (2d) 190959 inappropriate verbal comments; 17 witnessed unwelcomed touching and/or comments to their teammates; and 8 reported feeling discomfort or suspecting “other” intentions from plaintiff. Five of the students were also pupils in plaintiff’s classroom. Also, the students alleged that plaintiff violated students’ personal spaces and looked or stared at them in a way that made them feel uncomfortable. ¶ 10 On May 9, 2017, DeVonne submitted to the Board a two-page “EXECUTIVE SUMMARY” of the allegations against plaintiff and the findings of the investigation. She also submitted a three-page document entitled “SUPPORTING DOCUMENTS,” which contained more details on the investigation, including a factual timeline concerning the allegations and the investigation, a summary of a 2012 investigation, and a summary of the relevant Board policies. DeVonne recommended that the Board terminate plaintiff due to his sexual harassment of female students. The Board unanimously approved the recommendation. ¶ 11 On May 16, 2017, the Board gave plaintiff a nine-page notice of the charges, with a bill of particulars, notifying plaintiff that the Board approved, by a unanimous vote, his dismissal as a tenured teacher. In the notice, the Board stated that after it was notified on March 21, 2017, of an allegation that plaintiff had sexually harassed a member of the girls track team by touching her on the buttocks, the investigation was conducted. The Board noted that the administration had concluded that plaintiff “sexually harassed multiple female students by engaging in leering, unwelcome touching, and making sexually suggestive comments and innuendos at varied times throughout the 2015-2016 and 2016-2017 school years.” The Board also stated that it had found that plaintiff engaged in irremediable conduct that created a negative psychological effect on students; caused negative and detrimental relationships with students; deterred students from the full educational opportunities of the Waukegan schools; injured the reputation of—and the faith -4-  2020 IL App (2d) 190959 of the public, staff, and students in—the faculty and the school as a whole; and brought disrepute upon the teaching profession. The Board determined that plaintiff engaged in sexual harassment, in violation of Board policies 4002, 4306, 6021, and 6040. The bill of particulars also related a May 2012 incident, 1 which was determined to be unfounded but plaintiff was nonetheless put on notice “that care in your dealings with female students was necessary and that sexual misconduct of any nature with students is intolerable and a potential basis for discipline. Despite this warning and experience, you did not modify your behaviors or exercise sufficient care and discretion in your verbal discourse, treatment, sexual innuendo and touching contacts with young female student-athletes.” ¶ 12 Further, the bill of particulars noted that, at plaintiff’s April 14, 2017, due-process meeting, he denied any inappropriate conduct. He subsequently submitted a written statement wherein he also denied any misconduct. The Board stated that plaintiff’s lack of candor and his denial of the allegations, “despite voluminous accounts of inappropriate incidents[,] effectuated misrepresentation of facts rising to insubordination.” It continued, “[w]hile willful deception and false statements are often deemed remediable, these behaviors during the course of the investigation buttressed negative conclusions about your character and your conduct as a teacher who should be focused on the well-being of students.” ¶ 13 The Board noted that it had concluded that plaintiff’s conduct was irremediable, having a negative impact on the teaching profession and psychologically harmful to the students. 1 “[A] female student reported you rubbed on her shoulder after she asked you to stop, and you rubbed on her pen in a sexually suggestive manner which caused her great discomfort.” -5-  2020 IL App (2d) 190959 ¶ 14 Plaintiff exercised his right to a hearing before a hearing officer. 105 ILCS 5/24-12 (West 2018). ¶ 15 B. Hearing ¶ 16 On December 4, 2017, a hearing commenced before a hearing officer of the Illinois State Board of Education. 105 ILCS 5/34-85 (West 2018). ¶ 17 1. B.S. ¶ 18 B.S., age 19 and African-American, testified that she attended WHS for three years and graduated in June 2016. She grew up in a two-parent household and is currently attending college. She participated in track from her sophomore year until she had to leave in her senior year because of a health issue and her grades. ¶ 19 Plaintiff was B.S.’s coach during her junior year. B.S. had several issues with plaintiff when she participated in the track program. Once, while outside at the track, plaintiff touched her buttocks and told B.S., “good job.” “I didn’t feel comfortable with it. Most coaches would tap you on the shoulder or something.” B.S. told plaintiff not to touch her. He did not say anything. B.S. reported the touching incident to Taylor, the athletic director, who stated that he would speak to plaintiff. She never heard back from Taylor. She approached Taylor (and his wife, who worked in the school office) several times and never heard back from him. B.S. agreed that the touching incident could have reflected that plaintiff was proud of her. ¶ 20 Another incident occurred after B.S. had gone to the emergency room. Plaintiff asked B.S., “you’re not pregnant are you?” and “he started laughing.” B.S. did not quit the team after this incident, testifying “I love track. Track is what I do. *** I stayed on the team to do what I wanted to do.” On another occasion, at the end of practice, plaintiff stated that the girls could run in sports -6-  2020 IL App (2d) 190959 bras. Afterwards, because of that comment, B.S. changed the way that she dressed and never dressed in sports bras or tight pants. ¶ 21 2. Ellisstatia S. ¶ 22 Ellisstatia S., B.S.’s mother, testified that she addressed plaintiff’s lack of respect at a parent-student-coach meeting in 2015. (At the time, B.S. was a junior.) Ellisstatia told plaintiff that, if he wanted respect from the girls, he needed to give back that respect. Plaintiff turned beet red. ¶ 23 At a meet, Ellisstatia attempted to speak to plaintiff, but he was dismissive of her. She observed that he belittled the girls and did not have high expectations for them, such as when she spoke of B.S. going to college or joining the Army. In order for him to listen to her, she had to tell plaintiff that B.S. was from a two-parent home, where both parents were concerned about her. ¶ 24 After B.S. told her that plaintiff slapped her on the buttocks, Ellisstatia never called or e- mailed plaintiff to discuss the matter. Nor did she report it to the athletic department. ¶ 25 3. N.P. ¶ 26 N.P., age 15, was a sophomore at WHS during the 2017-18 school year. She is Hispanic. Plaintiff was her track coach during her freshman year. Once, while the girls were doing “abs,” he commented that one girl did not have to do “abs” because she already had them. During the winter season of 2017, in the basement of the indoor track while most of the girls were present, N., a fellow track member, stated that she was hot because they were all sweaty from working out. In response, plaintiff stated, “we all know that you’re hot, like you don’t have to show off.” They all knew that it was a joke, but N.P. did not think it was appropriate. ¶ 27 N.P. also related that plaintiff got “too close” when he spoke to her. This occurred “sometimes,” and made her uncomfortable. She did not say anything to plaintiff about it but would -7-  2020 IL App (2d) 190959 just step back. On one occasion, during winter season while the girls were finishing practice, N.P. spoke to plaintiff about missing practice. She was leaning against a door with one leg, and her other leg was extended out. Plaintiff stepped over the extended leg with one of his legs. He stood there for about 10 to 20 seconds, only a few inches away from N.P. N.P. pulled back from the doorway. Plaintiff did not move closer to her. She did not tell anyone because she did not think anything else would happen, and nothing did happen. N.P. did not stop running track. A few times after this incident, plaintiff got too close to N.P. during conversations. She would just step back because it made her uncomfortable. Plaintiff never touched N.P. and never said anything of a romantic or sexual nature to her. She observed plaintiff being very close to other girls. ¶ 28 4. H.P. ¶ 29 H.P., age 17, testified that she is a senior at WHS. She participated in track during her sophomore and junior years, and plaintiff was the head coach during that time. ¶ 30 H.P. had some issues with plaintiff. During her sophomore year, in a practice room with all of the girls present, H.P. took two pairs of pants to go try them on. She turned around and felt something hit her buttocks. When she turned, she saw that plaintiff had a rolled up piece of paper. She did not say anything to plaintiff. As time passed, she believed that it was not appropriate. “It touched my bottom which isn’t appropriate for anyone to touch without consent.” H.P. told her father about the incident, and he advised her to keep an eye out and keep herself safe. H.P. testified that she did not report the incident to anyone at the school, because she believed that no one would take it seriously. Also, other girls had told her that they had complained about plaintiff but that no one took any action as a result. ¶ 31 On another occasion, while weightlifting with some of her teammates, H.P. told the group that her fitness tracker’s batteries had died. Plaintiff walked up and said, “oh, you shouldn’t need -8-  2020 IL App (2d) 190959 that because to me, it looks like you’re fit enough.” H.P. believed that the comment about her physical appearance was not appropriate. Another incident occurred in the indoor track, after H.P. had expressed frustration that an equipment issue prevented her from practicing the pole vault. Plaintiff stated that he cared only about her and five other girls on the track team. H.P. testified that it was not appropriate for plaintiff to state that he cared about only a fraction of the girls on the team. ¶ 32 Plaintiff also invaded H.P.’s personal space. This was “pretty normal.” He “got a little close to us, so I would step back.” She also observed him doing this to others. It was a topic that the team discussed. Other girls privately complained to her about it. ¶ 33 Plaintiff was removed as coach sometime in March 2017, and Peter Valdez took over. The Chicago Tribune published an article about plaintiff and his treatment of female athletes. H.P. and her teammates discussed the article. ¶ 34 H.P. further testified that she got along with plaintiff. He never made any sexually suggestive or romantic comments to her. She is not returning this year to the team, but it is not due to plaintiff (once he left, the team had a new coach with whom she was comfortable); she has other activities in which she is involved. ¶ 35 In her written statements to the school and to the police, H.P. did not mention that plaintiff got too close to her and invaded her personal space or that he made the fitness-tracker comment. ¶ 36 5. J.O. ¶ 37 J.O., age 17, testified that she is Mexican and currently a senior at WHS. She has been on the track team each year in high school. Plaintiff was her coach the first two years. J.O. had no problems with plaintiff as her coach and did not observe other girls have issues with him, but she heard things. -9-  2020 IL App (2d) 190959 ¶ 38 After a race, J.O. overheard B.S. state that plaintiff touched her buttocks. J.O. did not see this happen. Plaintiff never touched J.O., nor did she ever hear him make inappropriate comments to any athletes. When he spoke to J.O., plaintiff stood at an appropriate distance away from her and J.O. never felt uncomfortable. ¶ 39 In her written statement to the school, J.O. wrote that, at the beginning of the 2016 school year, plaintiff made a comment to several boys whom he was trying to recruit to the cross-country team. “He said what’s better than seeing girls in short shorts.” J.O. overheard plaintiff’s comment and felt that it was inappropriate. She did not report it, because she did not want to make a big deal out of it. J.O. “never saw [plaintiff] interacting with our girls like in a bad way, so [she] never took action to it.” ¶ 40 6. Beatrice J. ¶ 41 Beatrice testified that she is guardian of T.J., her granddaughter. T.J. graduated from WHS in 2017. T.J. ran track for all four years of high school. Beatrice attended nearly all of the meets. She had a good relationship with the girls on the team and many called her “Grandma.” ¶ 42 Beatrice knows S.W., with whom T.J. used to ride home after practice. In March 2017, T.J. and S.W. attended the Carthage meet in Kenosha, Wisconsin. It was a Friday. S.W. reported to Beatrice that plaintiff was touching the girls on their buttocks. Two other girls were present for this conversation. Beatrice asked if T.J. had reported the information, and she stated that she reported it to Taylor. Beatrice spoke to Zucker, a coach for the Libertyville girls’ team and the girls’ cross-country coach for WHS, whom Beatrice had come to know. Zucker suggested that it be reported to Dr. Hamlin, the assistant principal at WHS’s Washington campus. ¶ 43 T.J. told Beatrice that plaintiff had never touched her buttocks. Beatrice testified that she believes it is not appropriate for a male coach to touch a female athlete’s buttocks. - 10 -  2020 IL App (2d) 190959 ¶ 44 7. K.O. ¶ 45 K.O., age 17, testified that she is a senior at WHS. She has been involved in track for three years, and plaintiff was her head coach for the first two years. K.O. testified that plaintiff made comments that were not appropriate. On one occasion, in January or February 2017, K.O. and a couple of other students (including M. and A.C.) were practicing shot put. Plaintiff stated that “you were supposed to use the junk in your trunk.” The student toward whom the comment was directed appeared uncomfortable. K.O. agreed that, prior to making the comment, plaintiff told the student that she needed to use her lower body, which was a coaching suggestion, because, in putting a shot, using the lower body is essential. However, K.O. viewed the comment as inappropriate. Now, she views it as him coaching on how to use other parts of the body. K.O. never observed plaintiff touch any students or heard any other inappropriate comments. ¶ 46 8. J.M. ¶ 47 J.M., age 18, testified that she participated in track for two years. During the 2016-17 school year, her senior year, plaintiff was her coach. J.M. overheard plaintiff make inappropriate comments during the time she was in track. Once, when the girls were indoors practicing throwing, plaintiff stated that another student should be able to shift her hips “because you have junk in the trunk or something along the lines of that.” J.M. testified that it was not something you would say to a girl. J.M. understood that plaintiff was trying to drive home a point about a coaching technique. The girls giggled “like it was weird.” J.M. did not report the comment to anyone but her parents. She did not quit the team because of the comment. Plaintiff did not make other comments that J.M. viewed as inappropriate. ¶ 48 9. A.C. - 11 -  2020 IL App (2d) 190959 ¶ 49 A.C. attended WHS between 2013 and 2017. She was on the track team for three years, and plaintiff was her coach. She had issues with plaintiff. He made a comment about a girl’s buttocks (“about having like junk in the trunk”), which made her uncomfortable. Also, plaintiff swung his lanyard (which had a timer on it) and hit girls in the buttocks with the string part. It happened once to A.C. when she was a junior, during practice in the indoor track, and she saw it happen to another girl. A.C. did not say anything to plaintiff when he hit her, but she “was kind of creeped out.” H.P. told A.C. that plaintiff hit her buttocks with a rolled up piece of paper. In her written statement, A.C. also related that plaintiff said things that were “creepy” and that he looked girls up and down in a “weird” way. Specifically, plaintiff once looked A.C. up and down and said “oh, looking good, C.” It made her feel uncomfortable, because it was a comment about how she looked physically rather than her performance as an athlete. ¶ 50 A.C. also testified to the incident. Once, when she wore a tank top and tight-fitting pants, which she did not typically wear, plaintiff looked her up and down and said “looking good” in a way that made A.C. uncomfortable. She was standing around and not competing or doing anything athletic when he made the comment. “I just feel like that’s something you should know, that you shouldn’t talk to teenage girls that way because it is kind of weird.” ¶ 51 A.C. testified that she did not believe that the lanyard incident was sexual, but it felt uncomfortable and she believed that it was inappropriate. She did not report it to her parents, because she was not comfortable talking about it. About six or eight months after the incident, A.C. asked plaintiff for a college letter of recommendation. A.C. further testified that plaintiff treated her with respect as a captain of the track team. At the time she gave her statements, she did not believe that plaintiff should be fired. ¶ 52 10. T.J. - 12 -  2020 IL App (2d) 190959 ¶ 53 T.J., who is African-American and Hispanic, attended WHS for four years and graduated in 2017. She participated in track for four years, and plaintiff was her coach for three years. T.J. had no problems with plaintiff and never heard him make inappropriate comments. However, during her senior year, in the spring of 2017, S.W. reported to T.J. and several other girls that plaintiff had inappropriately touched her with his hand on her buttocks during track. She was upset and angry. S.W. did not quit the track team because of it, nor did T.J. The other girls that stood close by did not quit the team. ¶ 54 11. J.B. ¶ 55 J.B. testified that she attended WHS between 2013 and 2017. She was on the track team all four years. Plaintiff was her coach during her sophomore and junior years. Plaintiff made comments that made her feel uncomfortable. Once, in the weight room when the girls were squatting, plaintiff said “stick out your butt.” J.B. found this comment inappropriate because it was not the right way an older man should speak to teenagers. He made this comment three times. When A.C. wore a tank top or something more revealing, he said “you look really nice today” or “looking good today.” A.C. told J.B. that the comment made her feel uncomfortable. J.B. also heard from someone else that plaintiff made the junk-in-your-trunk comment to another girl and that it made her feel uncomfortable. ¶ 56 J.B. did not tell plaintiff that the stick-your-butt-out comment made her uncomfortable, because she did not want to have an uncomfortable conversation with him, as he was her coach. She did not report the comment, because “we had all heard that there were reports made before and we all heard that nothing had been done about it before.” She did not verify if these rumors were true. J.B. did not quit the team, and she later became a captain. It was not so much plaintiff’s language, but his tone of voice that was disrespectful. J.B. felt that she did not have a good - 13 -  2020 IL App (2d) 190959 relationship with plaintiff, because the comments he made never made her feel comfortable around him. ¶ 57 12. S.W. ¶ 58 S.W., who is African-American, attended WHS and participated in track for four years. Between her sophomore and senior years, plaintiff was her coach. ¶ 59 S.W. had problems with plaintiff. In April 2016, in Rock Island, she was talking to plaintiff from the jumping pit, and he said, “let’s go. And then he smacked my butt with his hand.” S.W. walked off and was in shock. She did not say anything to plaintiff, but she told the other girls on the team. S.W. testified that the slap made her feel uncomfortable. She did not report the incident to anyone, because she did not believe that anyone would listen to her. B.S. had said that the same thing happened to her, she reported it to Taylor, and he did not do anything about it. During an outdoor meet, S.W. told Beatrice about the incident, stating that “he smacked my butt and that all the other girls feel uncomfortable around him.” S.W. testified that she did not quit the team after the Rock Island incident, because she wanted to focus on track. She loves track and was doing well in the sport. ¶ 60 In her written statements to the police and the school, S.W. stated that plaintiff came into the girls’ personal space, about six inches apart. It made S.W. feel uncomfortable. She backed up when plaintiff spoke to her. Plaintiff was a “close talker” with everyone, including adults. After she stepped back while speaking to him, plaintiff would not come closer toward her. ¶ 61 When plaintiff said, “let’s go,” he wanted to make sure that S.W. did not get scratched from the event for being late. However, S.W. testified, it is not right for an older man to “smack me on my butt and tell me all right, let’s go.” None of the other girls saw him smack S.W. S.W. was scared to say anything to plaintiff about the incident. She did not know what to say. “He makes - 14 -  2020 IL App (2d) 190959 me feel uncomfortable. So I didn’t know how to speak up.” After he hit her on the buttocks, S.W. ran the four by four and was still thinking about the incident. She believes that it impacted her ability to run well. ¶ 62 S.W. did not tell her parents about the incident, because they would have made her quit the team. When they did find out, S.W.’s father told her that she could not go to practices. She stopped for a while. Once Valdez was made head coach, S.W. returned to the team. ¶ 63 After the Rock Island meet, S.W. attended a clinic in Naperville with two other girls and plaintiff. If the other girls had not attended, S.W. would not have gone with plaintiff, because she felt uncomfortable around him. After the clinic, while they were out to eat, the girls took photos of their food and posted them on Snapchat. Plaintiff said that he had a pickle and asked if the girls wanted to take a picture of his pickle. S.W. thought that the comment was inappropriate because it was “kind of” sexual in nature. She did not report the incident and did not include it in her statement to the school. According to S.W., school officials wanted her to write only about the buttocks incident. She did not write that it affected her performance. Nor did she mention these things in her statement to the police. ¶ 64 13. Lori Massimo ¶ 65 Massimo was the campus director for WHS’s Brookside campus between 2013 and 2017. She reported to Brian Reigler, the principal. Massimo described plaintiff as a close talker. Given her sensitivity to this, she would take a step back when speaking to him. After the allegations arose about plaintiff hitting a girl on the buttocks, Massimo was assigned the role of interviewing and obtaining statements from the girls on the track team. She interviewed about 20 girls. ¶ 66 14. Eric Levin - 15 -  2020 IL App (2d) 190959 ¶ 67 Levin was a house leader at WHS. Plaintiff was in his group of teachers. Plaintiff taught sophomore English. Levin prepared some of plaintiff’s performance evaluations. He rated plaintiff “proficient” in his evaluations. ¶ 68 In 2012, Levin investigated L.T.’s complaint that plaintiff picked up a pencil in a sexual manner. Ultimately, he could not substantiate the allegation, and the investigation concluded that there was no picking up of a pencil in that manner. Levin has had conversations with plaintiff about having respect, “being aware of what students may be presenting,” and space within the classroom, such as walking down small aisles. 2 ¶ 69 During the time he worked with plaintiff, Levin never raised any concerns about him. He did not coach with him or have any discussions with female athletes about him. Levin was not involved in the investigation of the allegations in this case. ¶ 70 15. Theresa Plascencia ¶ 71 Theresa Plascencia became school superintendent on July 1, 2016. She reports to the Board. There are over 4000 students in the Waukegan high schools. About 79% of the students are Latino or Hispanic, and 14% are African-American. Plascencia is of Latin descent and grew up in the Little Village community in Chicago, which is very similar to Waukegan. She explained that, culturally, the Waukegan community consists of a lot of students who are newcomers to the United States and many are undocumented. According to Plascencia, the educator is an esteemed 2 The hearing officer found that Levin’s testimony about the 2012 complaint, investigation, and conversation with plaintiff was admitted for the limited purpose that Levin had counseled plaintiff about his behavior with students. The 2012 student complaint, the officer found, was “hearsay and is not accepted as true.” - 16 -  2020 IL App (2d) 190959 profession in Mexico. Parents do not question an educator. Undocumented populations are often afraid to speak up, because of their status. Plascencia further testified that the African-American culture that she has worked with is also very compliant. In a low-income community, many of the students are being raised by one parent or by grandparents and many are homeless or living in multi-family units. Teachers are a source of stability for students. School is the only safe space they have for meals and where things are consistent. 3 ¶ 72 Addressing the process for discharging a tenured teacher, Plascencia explained that the issue goes before the Board, which engages in a discussion and then votes on the matter. In plaintiff’s case, there were complaints from students of inappropriate touching. The problem had previously been reported, allegedly, but nothing had come of it. DeVonne recommended plaintiff’s termination because Board policies had been broken. Plascencia agreed. The policies violated were a teacher’s duties, sexual harassment, student harassment, and student discipline. The substantiated allegations that DeVonne found included physical touching, unwanted touching, sexual harassment, not providing a safe environment, and infringement on students’ rights. ¶ 73 The Department of Children and Family Services (DCFS) became involved but did not make a finding of abuse or neglect. This, however, did not change Plascencia’s opinion as to whether plaintiff should be discharged. She recommended discharge, as opposed to a lesser discipline, because the policies outline that unwanted touching includes situations when the child 3 Upon plaintiff’s objection to this testimony, the hearing officer declined to strike it but noted that she would not place much weight on it, because it was not “particularly probative because of its generality and the lack of tie in to the particular students. So there are so many explanations for why someone did or did not report something.” - 17 -  2020 IL App (2d) 190959 does not know if it is right or wrong. Also, the child does not have to say that it is unwanted. Further, an educator should not make a student feel unsafe. “[I]t’s known that you don’t touch students.” A coach is still an educator. “That is sexual harassment. *** You should set the model for what good behavior is.” ¶ 74 Plascencia further testified that she believed that plaintiff’s behavior was irremediable because there was a pattern of behavior in how he interacted with students and what he deemed appropriate in his interactions with them. The behavior could have caused, or did cause, psychological damage to the students. In preparing for the case, many of the students wanted to forget about the experience “because they want to close this chapter in their life[,] which victims do.” Further, the fact that the students said that it was inappropriate showed that they were in turmoil. It took a lot of endurance to speak out, “because of the possibility of being ridiculed by their peers, but even worse case in education, the belief of an adult factor. So it really takes a lot for a child to come forward.” ¶ 75 Plascencia testified that plaintiff’s conduct damaged the district’s reputation. There were many articles written about him and the incidents. Also, there was “chatter” on Facebook about him, including comments about how previous students felt about him. These comments questioned whether the district could keep its students safe. Plascencia did not believe that, if plaintiff had been given a sanction other than discharge, he would not have repeated his conduct. He had a reputation, and, given how he interacted with the girls over a period of time, this was his norm. As a professional, one knows what is and is not appropriate conduct. Given his bachelor’s degree and license to practice education, “he knows what appropriate verbiage, what appropriate touching is.” ¶ 76 The police became involved in this matter when they were informed by human resources. No criminal charges were filed. This had no impact on whether he should have been terminated. - 18 -  2020 IL App (2d) 190959 ¶ 77 Plascencia further testified that her conclusion that termination was the only option was not due to any fear of media backlash if plaintiff were not terminated. She explained that the media became aware of plaintiff’s case after his termination. Thus, there was no fear of a potential story. ¶ 78 16. Sadara DeVonne ¶ 79 DeVonne testified that she is the director of employee relations and EEO and Title IX coordinator for the district. She began working for the district in November 2016. She investigates claims of harassment and discrimination. ¶ 80 DeVonne first became involved in plaintiff’s case in March 2017. She reviewed e-mails from several district administrators concerning Zucker’s report about a track team member. Reigler appointed Massimo to assist DeVonne in her investigation. DeVonne sat in on about 15 interviews. She also spoke to current and former staff, including Valdez, Massimo, Taylor, and Levin. They expressed concerns about plaintiff’s treatment of females in general until DeVonne began asking about the track team. None of the staff had observed any misconduct. ¶ 81 B.S. told DeVonne that she reported to Taylor that plaintiff touched her buttocks. Taylor, however, told DeVonne repeatedly that he never received any reports or complaints of that nature. (DeVonne did not make a determination whether Taylor’s denials were truthful.) He had a good relationship with plaintiff. However, Taylor told DeVonne that plaintiff was a close talker and that he had experienced that himself. He also stated that plaintiff and Zucker did not get along. ¶ 82 DeVonne interviewed A.C. and found her truthful. A.C. stated that there had been physical contact by plaintiff and that the conduct was inappropriate, but she was defensive of plaintiff and worried about the outcome. DeVonne also interviewed S.W., who was upset. She related being slapped on the buttocks by plaintiff. She was embarrassed and stated that it was inappropriate for a coach to make a student feel that way. She shrugged when asked if she was comfortable around - 19 -  2020 IL App (2d) 190959 plaintiff. H.P. told DeVonne that plaintiff swatted her on the behind with a rolled-up piece of paper. DeVonne also spoke to J.O., who stated that she was aware that B.S. had claimed that plaintiff had smacked her on the buttocks and said that she heard other comments that plaintiff made to the girls on the track team. J.O. also reported that B.S. claimed that plaintiff told several boys he was trying to recruit that “what’s better than seeing girls in short-shorts.” DeVonne stated that a large number of student athletes said that they had no problems with plaintiff and never heard or saw anything inappropriate. ¶ 83 DeVonne further testified that she met with plaintiff three or four times. Plaintiff had been removed from the classroom at the commencement of the investigation. At one of the meetings, when DeVonne informed plaintiff of the allegations against him, the meeting became contentious and plaintiff denied the allegations. DeVonne was surprised by the denials. ¶ 84 Upon completion of the investigation, DeVonne made recommendations and conclusions, including that plaintiff “had violated Board policy by engaging in unwelcome touching of multiple students, leering, and made inappropriate verbal comments to multiple students.” She recommended terminating plaintiff’s employment. In an April 21, 2017, letter to plaintiff informing him of this recommendation, DeVonne cited several Board policies that she asserted had been violated, including the harassment policy. ¶ 85 Next, DeVonne drafted an executive summary to Plascencia, general counsel, and the Board, providing an overview of the investigation, the findings, and the reasons for the recommendation. The executive summary consists of the summary and supporting documents. Copies were provided to everyone at the Board’s May 9, 2017, meeting, including plaintiff. DeVonne’s role at the Board meeting was to defend the administration’s proposed actions and recommendation to terminate plaintiff’s employment. Beatrice testified at the meeting, and - 20 -  2020 IL App (2d) 190959 plaintiff was given the opportunity to present a defense. After she learned of the Board’s decision, DeVonne prepared a bill of particulars for plaintiff. That document generally covered the same material as in the executive summary. ¶ 86 DeVonne further testified that two reports were made to DCFS. The first was on March 22, 2017. DCFS declined to open an investigation. DeVonne contacted DCFS a second time, after she had the statements from the students. ¶ 87 During one of her meetings with plaintiff, he stated that he had never touched any student. He claimed that B.S. was upset with him because, after she had taken some time off and wanted to come back and run, he did not allow her to. He also stated that she was upset because she did not make captain. ¶ 88 Board policy, according to DeVonne, provides that sexual harassment includes unwelcome touching. The students told her that the touching was not welcome, and to DeVonne, this met the requirement for sexual misconduct. Board policy also states, she testified, that instances of unwelcome touching will be treated as sexual abuse. The totality of what the students reported to her led her to conclude that plaintiff’s actions were sexual in nature: the touching, making comments, staring, leering, invading personal space, and that the students felt uncomfortable and some of them did not continue participate in the team. ¶ 89 One of the male staff members had a conversation with plaintiff about him giving out a “creepy” vibe to the students. The staff member told DeVonne that it was generally known and that plaintiff was told to be aware. The district has sexual harassment training where Title VII and Title IX are discussed with staff, and it covers the Board’s policy on harassment, including sexual harassment. ¶ 90 The Board rested. Plaintiff did not put on a case and rested. - 21 -  2020 IL App (2d) 190959 ¶ 91 C. Hearing Officer’s Decision and Subsequent Proceedings ¶ 92 On October 24, 2018, the hearing officer issued her factual findings and recommendation. The officer found that the Board had proven that plaintiff engaged in the charged offenses and that the offenses constituted sufficient cause to dismiss him pursuant to section 24-12(d)(1) of the School Code. 105 ILCS 5/24-12(d)(1) (West 2018). She recommended that plaintiff be dismissed. ¶ 93 Specifically, the hearing officer found that plaintiff committed many of the offenses listed in the May 9, 2017, executive summary. She found that plaintiff hit four students on their buttocks. B.S. and S.W., the officer noted, testified credibly on this issue. H.P. was also credible in relating that plaintiff hit her on the buttocks with a rolled up piece of paper, and A.C. was credible in relating that plaintiff hit her on the buttocks with his lanyard and did the same thing to another teammate. The hearing officer also determined that plaintiff inappropriately invaded students’ physical space. H.P., N.P., and S.W., the officer found, credibly testified that plaintiff got too close to them when speaking to them and made them uncomfortable. This practice had been observed by Massimo, whose testimony corroborated the students’ testimony. Further, in at least one instance, the invasion took on a sexual innuendo, where N.P. testified that plaintiff straddled her outstretched leg while talking to her, causing her to back away when he failed to move away for 10 to 20 seconds. The hearing officer also found that plaintiff made comments to students about their appearance and looked at them in ways that made them uncomfortable. Even when he made comments that might be deemed to be coaching suggestions, the officer noted, he used crude language (“use the junk in your trunk,” “stick your butts out”) that made the students uncomfortable or used it in a way that made them feel so. She also noted that the question to B.S., made while laughing and in the presence of her teammates, about whether she was pregnant when - 22 -  2020 IL App (2d) 190959 she had to withdraw from track for medical reasons “was rude, disrespectful, sexually loaded, and highly inappropriate.” ¶ 94 The hearing officer rejected plaintiff’s arguments that the students’ testimony was not credible because, until S.W. spoke to a teammate’s grandmother, the students (other than B.S.) did not report his actions or their discomfort with them and continued to participate in track. The officer noted that several students testified that they did not complain about plaintiff’s comments or conduct, because they were scared, they did not think they would be believed, they knew that B.S. had complained to no avail, or they wanted to remain on the team for the love of the sport. The officer found that the students’ reactions were “plausible from high-school-aged girls, reacting to a middle-aged man who was in a position of authority both as a teacher and as their coach.” Further, after they were asked about his treatment of them, the officer found, they testified credibly and consistently. Plaintiff “ogled the athletes, he stood too close to them, he used cruder language about their bodies than they were comfortable with, he made inappropriate comments about their bodies, and he hit several of them on their buttocks.” ¶ 95 The Board had cited several Board policies in voting to dismiss plaintiff. The hearing officer found the following policies relevant. First, Board Policy No. 4306—“Duties – Teachers”—provides that teachers “[w]ill not discriminate against or harass any student,” “[w]ill accept each child as a person possessing individual worth and dignity and refrain from directing damaging remarks and expressions either in class or in other situations,” and “[w]ill review and maintain familiarity with current Board policies.” Next, Board Policy No. 4002—“Harassment Prohibited”—prohibits “harassment or abusive conduct on the basis of an individual’s *** sex” and provides that it constitutes a violation of the policy to “harass another *** student through unwelcomed conduct or communication of a sexual nature.” “An employee found to have engaged - 23 -  2020 IL App (2d) 190959 in harassment, based on a preponderance of the evidence, is subject to discipline, up to and including discharge.” “Harassment” includes “derogatory or demeaning comments, jokes or personal questions” and “inappropriate verbal or physical conduct or communications made on the basis of sex when *** [s]ubmission to such conduct is made either explicitly or implicitly a term or condition of any individual’s *** education *** or [s]uch conduct has the purpose or effect of substantially interfering with an individual’s *** academic performance or creating an intimidating, hostile, or offensive *** educational environment.” Examples of sexual harassment include “sexual innuendos,” “sexually suggestive comments,” “leering,” “inappropriate and/or unwelcome touching,” and “verbal harassment or abuse of a sexual nature.” Unwelcome touching “means touching any part of the body in a manner which a reasonable person would perceive to be sexually motivated or sexually suggestive, or otherwise inappropriate in an academic or work environment. It includes, but may not be limited to: pinching, patting, or brushing parts of the body. It also may include actual or attempted kissing, fondling, sexual assault. Any touching of a student by an employee in a sexual manner is unwelcome, irrespective of perceived or verbalized consent by the student. All complaints of unwelcome touching of a student will be treated as allegations of sexual abuse.” Finally, Board Policy No. 6021—“Harassment of Students Prohibited”—specifically addresses sexual and other harassment of students. It states that “unwelcome touching” that would be deemed sexual abuse is “touching any part of the body that is normally covered by a bathing suit.” ¶ 96 The hearing officer determined that plaintiff’s conduct violated the foregoing policies. She noted that, while a single occasion of standing too close to a student might not qualify as sexual - 24 -  2020 IL App (2d) 190959 harassment, the students described experiencing a range of behavior by plaintiff. The totality of his conduct made them uncomfortable. ¶ 97 Turning to whether plaintiff’s conduct was remediable, the hearing officer noted that the test was whether (1) damage was done to the students, faculty, or school and (2) the conduct could have been corrected had the teacher been warned. The hearing officer determined that both the students and the school had been harmed by plaintiff’s conduct as coach. She determined that plaintiff’s conduct, which put the students in a demeaning and personally undermining situation, was “harm in and of itself, even without expert proof of physical injury, or psychological or emotional damage. The student’s testimony was proof enough.” As to the school, the hearing officer found that plaintiff’s conduct harmed it by impairing the district’s ability to carry out its stated policies about the education and treatment of the students. Also, she noted that plaintiff’s dismissal received negative press coverage, which had the potential to harm the district’s reputation in the community. Turning to the second prong of the remediability analysis, the hearing officer determined that plaintiff’s conduct would likely not have been corrected had he received a warning and an opportunity to correct it. The officer found that plaintiff had been warned in 2012 about getting too close to students. At that time, Levin could not substantiate a complaint from a student but advised plaintiff to be aware of the closeness of physical spaces in his classroom. The hearing officer also noted that plaintiff should have known that his conduct as a male coach, “so full of sexual innuendo, was inappropriate and damaging to the female athletes who depended on him for instruction, encouragement and support.” Addressing the junk-in-your-trunk and stick- your-butts-out comments, the officer found that they were made as coaching instructions and were the mildest of plaintiff’s misconduct. However: - 25 -  2020 IL App (2d) 190959 “[t]o leer at his athletes, to straddle the leg of one of them, to get so close to them so often that they were uncomfortable, to urge boys to join the track team to watch the girls in their short shorts in the presence of one of those girls, to try to joke with a female athlete that the medical reason for her withdrawal from the team might be pregnancy, among other things, along with [plaintiff’s] continued denial of the gravity of his conduct as indicated in his post-hearing defense, demonstrate such a fundamental lack of respect for the athletes as individuals rather than sexual objects, so deeply inappropriate for a male teacher coaching a girls’ team, that there is no reason to anticipate that a warning about his conduct would have spurred [plaintiff] to change.” ¶ 98 The hearing officer determined that the Board had demonstrated that plaintiff’s conduct met the second prong of the irremediability test, and she recommended that plaintiff be dismissed. ¶ 99 On December 12, 2018, the Board notified plaintiff that, on December 11, 2018, it had adopted the hearing officer’s findings and dismissal recommendation. ¶ 100 Plaintiff sought administrative review of the Board’s decision. 105 ILCS 5/24-16 (West 2018). On October 8, 2019, the trial court affirmed the Board’s findings and its dismissal of plaintiff. Plaintiff appeals. ¶ 101 II. ANALYSIS ¶ 102 Plaintiff argues that the Board erred in dismissing him. He asserts that (1) the Board’s dismissal determination was erroneous where it found that he sexually harassed members of the track team and that his conduct was irremediable and (2) the Board did not strictly comply with the procedures for dismissing a tenured teacher for cause where it never approved a motion with specific charges and did not timely mail to plaintiff a notice of the charges and a bill of particulars. - 26 -  2020 IL App (2d) 190959 ¶ 103 The Administrative Review Law limits our review. 735 ILCS 5/3-101 et seq. (West 2018); Russell v. Board of Education of the City of Chicago, 379 Ill. App. 3d 38 , 43 (2007); see also 105 ILCS 5/24-16 (West 2018) (provisions of the Administrative Review Law apply to judicial review of administrative decisions of dismissal for cause under section 24-12 of the School Code). We must first determine whether the Board’s factual findings were against the manifest weight of the evidence. Raitzik v. Board of Education of the City of Chicago, 356 Ill. App. 3d 813 , 823 (2005). A finding is against the manifest weight of the evidence where no reasonable person would take the Board’s view. Id. at 824. Second, we must determine whether the findings provide a sufficient basis for the Board’s determination that cause existed for discharge or dismissal. Id. at 823. “A school board’s determination of cause to discharge is not prima facie true and correct; it is instead subject to reversal where it is arbitrary, unreasonable, or unrelated to the requirements of service.” Beggs v. Board of Education of Murphysboro Community Unit School District No. 186, 2016 IL 120236 , ¶ 63. The “clearly erroneous” standard of review applies to this mixed question of law and fact. Id. An agency’s decision is clearly erroneous where “we are ‘left with the definite and firm conviction that a mistake has been committed’ when applying the established facts to the applicable legal standard for discharge.” Id. (quoting AFM Messenger Service, Inc. v. Department of Employment Security, 198 Ill. 2d 380 , 393 (2001)). ¶ 104 Generally, we review the Board’s decision, not that of the hearing officer, which is merely a recommendation to the Board, or the trial court. Raitzik, 356 Ill. App. 3d at 823; see also Beggs, 2016 IL 120236 , ¶¶ 57, 61 (“the decision of the school board is the final decision for purposes of administrative review,” even where witness credibility drove the findings and the hearing officer, rather than the board, observed the witnesses). Here, however, the Board adopted the hearing - 27 -  2020 IL App (2d) 190959 officer’s findings and dismissal recommendation. Thus, we review the hearing officer’s decision to determine if it was erroneous. Id. ¶ 63. ¶ 105 A. Dismissal Decision ¶ 106 Plaintiff argues that the Board erred in determining that he should be dismissed. He contends that his conduct was not harmful to the students and was remediable. For the following reasons, we disagree. ¶ 107 1. Cause for Dismissal ¶ 108 Under the School Code (105 ILCS 5/1-1 et seq. (West 2018)), a tenured teacher can be dismissed only for cause. 105 ILCS 5/24-12(d)(1) (West 2018). Although the School Code does not specifically define “cause,” case law has defined it as “that which law and public policy deem as some substantial shortcoming which renders a teacher’s continued employment detrimental to discipline and effectiveness.” Raitzik, 356 Ill. App. 3d at 831. A school board has the power “[t]o dismiss a teacher for incompetency, cruelty, negligence, immorality or other sufficient cause, to dismiss any teacher on the basis of performance and to dismiss any teacher whenever, in its opinion, he [or she] is not qualified to teach, or whenever, in its opinion, the interests of the schools require it.” (Emphasis added.) 105 ILCS 5/10-22.4 (West 2018). The School Code does not define “immorality.” In the context of schools outside Chicago, 4 immoral conduct has been described as 4 In Ahmad v. Board of Education of the City of Chicago, 365 Ill. App. 3d 155 (2006), in interpreting the term as it is used in the article of the School Code governing Chicago teachers (105 ILCS 5/34-1 (West 2004)), the court utilized the dictionary definition and noted that it has been defined as “ ‘shameless’ conduct showing ‘moral indifference to the opinions of the good and respectable members of the community.’ ” Id. at 165 (quoting Black’s Law Dictionary 751 - 28 -  2020 IL App (2d) 190959 “conduct [that] has no legitimate basis in school policy or society.” Fadler v. State Board of Education, 153 Ill. App. 3d 1024 , 1028-29 (1987). ¶ 109 The Board charged plaintiff with sexual harassment of female students. A school board must prove, by a preponderance of the evidence, that there is cause for dismissal. Board of Education of the City of Chicago v. Box, 191 Ill. App. 3d 31 , 37 (1989). ¶ 110 Plaintiff argues that the Board erred in finding that there was cause for his dismissal. He contends that the findings that he harmed the students and was warned after the “sexual pencil” investigation five years earlier are against the manifest weight of the evidence. He notes that his conduct occurred on the athletic field and that the athletes testified that they were not always comfortable with his conduct. However, he further notes, they also testified that he did not threaten or harm them and that they did not leave the team because of him. No expert, plaintiff notes, testified otherwise. Plaintiff notes that he had a good teaching record and no disciplinary history. He also notes that DCFS concluded that claims against him of abuse were unwarranted and that the Waukegan Police Department concluded that criminal charges were unwarranted. Plaintiff contends that there was no fondling, caressing, molesting, sexual advances, expressions of sexual attraction, or quid pro quo. He acknowledges that the hearing officer found the students credible witnesses and points to their testimony that no athlete left the team because of him and that several asked him for recommendations for school or work. ¶ 111 Plaintiff also argues that the Board erred in determining that his conduct violated its policies. He focuses on policy No. 4002, which addresses harassment, including sexual harassment, and includes a reasonable-person standard (noting that unwelcome touching “means (6th ed. 1990)). - 29 -  2020 IL App (2d) 190959 touching any part of the body in a manner which a reasonable person would perceive to be sexually motivated or sexually suggestive, or otherwise inappropriate in an academic or work environment”). Plaintiff asserts that the Board ignored this standard and instead credited Plascencia’s testimony, who did not consider what a reasonable person would perceive. The students, he notes, testified that they did not perceive plaintiff’s conduct as sexual. If the students were reasonable persons under the policy, he argues, then the Board could not disregard their undisputed testimony. ¶ 112 The Board responds that the hearing officer’s findings that plaintiff engaged in misconduct, which it adopted, were not against the manifest weight of the evidence, where plaintiff’s behavior warranted discharge for “immorality or other sufficient cause ” under section 22-4 of the School Code. 105 ILCS 5/10-22.4 (West 2018). The Board notes that B.S. testified that plaintiff had touched her on the buttocks as she was warming up, she was uncomfortable with this, and she told him not to touch her. She also testified to inappropriate comments that plaintiff made concerning whether she was pregnant and how he encouraged girls to run in their sport bras. Three other girls, the Board notes, testified that plaintiff had touched them on the buttocks and one testified that she had seen him do the same thing to another girl. Several girls testified that plaintiff invaded their personal space by standing so close to them that it made them uncomfortable. N.P. testified to an egregious example of this, where plaintiff straddled her leg. Several girls also testified to inappropriate comments by plaintiff, including about one of the girls being “hot,” another girl’s “abs,” the “looking good” comment to A.C., and the comment to H.P. concerning her fitness tracker and looking fit enough to him. The Board also notes that plaintiff made several other comments, including the junk-in-your-trunk comment, the comment to the boys about seeing girls - 30 -  2020 IL App (2d) 190959 in short shorts, and the pickle comment. In all, the Board argues, the finding that the behavior occurred and was ongoing was not against the manifest weight of the evidence. ¶ 113 Case law has held that conduct of a sexual nature constitutes immoral conduct or otherwise sufficient cause warranting dismissal. See, e.g., Board of Education of Sparta Community Unit School District No. 140 v. Illinois State Board of Education, 217 Ill. App. 3d 720 , 723-27 (1991) (reversing finding of no cause for dismissal and holding that male high school teacher/softball coach’s relationship with two female students, which consisted primarily of letters that the court concluded were “overtly sexual,” was immoral and unprofessional; teacher had written that he wanted to hold the girl(s) close, he looked forward to seeing how they looked every day, he appreciated a beautiful young woman when he saw one, and he wanted them to know how deeply he cared for them (“ ‘you are a pretty lady,’ ” “ ‘my feelings are strong for you’ ”); court noted that psychologist confirmed the sexual nature of the letters but that hearing officer understandably did not give that testimony much weight, as “the testimony of a psychologist was hardly needed to understand” teacher’s actions, which, as common sense dictated, had a “blatantly sexual basis”); Board of Education of the City of Chicago v. Box, 191 Ill. App. 3d 31 , 38-39 (1989) (reversing hearing officer and holding that the teacher’s conduct was unprofessional physical conduct; four students testified the teacher touched their buttocks and breasts; one student testified the teacher looked inside her blouse; one eyewitness student observed the teacher touch the five girls’ buttocks when they would ask questions and that he kept his hand there until he completed his answers; another student eyewitness testified that he observed the teacher put his arm around a girl and then touch her chest near the nipple area; two parents testified that their daughters either had trouble sleeping and did not want to go to school or had fears about male teachers and refused to go on a field trip; the teacher’s credibility had been impeached by some of his testimony); Fadler, 153 Ill. - 31 -  2020 IL App (2d) 190959 App. 3d at 1027 (affirming dismissal of elementary-school teacher charged with immoral conduct based on two incidents; teacher placed his hand under a student’s clothes and touched her buttocks and squeezed the breast of another student; noting that “[i]mmorality is a sufficient cause for dismissal as long as the record reveals harm to the pupils, faculty or school itself”; holding, without explanation, there was sufficient evidence of harm to students and school). ¶ 114 We conclude that the Board’s determination that plaintiff sexually harassed female students and that this constituted sufficient cause for his dismissal was not erroneous. Plaintiff’s conduct, which included touching students’ buttocks and using sexual innuendoes, could reasonably be interpreted as immoral and having “ ‘no legitimate basis in school policy or society.’ ” Sparta, 217 Ill. App. 3d at 729 (quoting Fadler, 153 Ill. App. 3d at 1029). The Board found the students credible, a finding plaintiff does not essentially challenge. Having found the students credible, the Board determined that plaintiff committed most of the offenses listed in the executive summary. Plaintiff did not put on a case, and we believe that the students’ testimony was not inherently incredible or otherwise problematic. B.S. testified that plaintiff touched her buttocks and told her she did a good job. She told him not to touch her, and plaintiff did not say anything. Another time, after he learned that she had gone to the emergency room, plaintiff asked B.S. if she was pregnant. He also encouraged the girls to run in sports bras, which caused B.S. to avoid such dress. N.P. testified that, while the girls were working on “abs,” plaintiff commented that one girl did not have to do such exercises because she already had “abs.” Another time, N.P. overheard plaintiff tell another girl, “we all know that you’re hot, like you don’t have to show off.” N.P. did not think the comment was appropriate. She also related that plaintiff stood too close when he spoke to her and that this made her uncomfortable and she would step back. She also related that plaintiff straddled his leg over hers during a conversation, which caused her to step back. H.P. stated that plaintiff - 32 -  2020 IL App (2d) 190959 struck her buttocks with a rolled-up piece of paper. Another time, after H.P. told her teammates that her fitness tracker had died, plaintiff stated that she did not need a tracker, “because to me, it looks like you’re fit enough.” She also related that plaintiff got too close and that she would step back; this was a topic her teammates discussed. J.O. testified that B.S. told her that plaintiff had touched her buttocks. J.O. also overheard plaintiff state to several boys, “what’s better than seeing girls in short shorts.” K.O. (as well as J.M.) testified concerning the junk-in-your trunk comment, which she viewed as inappropriate. A.C. testified that plaintiff used his lanyard to strike her and another girl’s buttocks, which “creeped” her out. She did not believe that the act was sexual, but it made her feel uncomfortable. She also testified that plaintiff leered at her and stated, “oh, looking good, C.,” which made her feel uncomfortable because it focused on her appearance and not her performance as an athlete. T.J. testified that S.W. reported to her that plaintiff had touched her on her buttocks and that she was upset and angry. J.B. testified that plaintiff told her three times to “stick out your butt.” Also, when A.C. wore a tank top or something more revealing, he stated, “you look really nice today” or “looking good today.” S.W. testified that plaintiff “smacked” her buttocks when she was in the jumping pit at the Rock Island meet, which made her feel uncomfortable and impacted her running, and that she reported it to Beatrice. She also reported that plaintiff stood too close, which made her feel uncomfortable. After the Naperville clinic, while out to eat, plaintiff made the pickle comment, asking if the girls wanted to take a photo of his pickle, which S.W. believed was inappropriate and sexual in nature. ¶ 115 Plascencia, the school superintendent, testified that plaintiff was dismissed because he violated Board policies, including one concerning sexual harassment. She recommended discharge because the policies encompass unwanted touching, including when the child does not know if it is right or wrong or does not say that it is unwanted. Plascencia stated that an educator should not - 33 -  2020 IL App (2d) 190959 make a student feel unsafe and that “it’s known that you don’t touch students.” DeVonne led the district’s investigation and recommended that plaintiff be terminated because he violated Board policy. The policy concerning sexual harassment includes unwelcome touching. DeVonne testified that the students she interviewed stated that the touching was not welcome. This met, in her view, the requirements for sexual misconduct. She concluded that plaintiff’s actions were sexual in nature, including the touching, making comments, leering, and invading personal space. ¶ 116 As the hearing officer noted in her decision, the students’ testimony was consistent, and we believe that she reasonably rejected plaintiff’s argument that their silence and continued participation in track reflected that they were not credible. The officer noted the testimony that several students were scared to speak up, did not think that they would be believed, knew that B.S. had complained to no avail, or wanted to remain on the team for the love of the sport. The officer reasonably determined that the students’ reactions, about a man who was an authority figure, were “plausible” for their ages. ¶ 117 Furthermore, the Board correctly determined that plaintiff’s conduct violated its policies, most significantly policy No. 4002, which prohibits harassment, including sexual harassment. The policy provides several examples of sexual harassment, including “sexual innuendos,” “sexually suggestive comments,” “leering,” and “inappropriate and/or unwelcome touching.” It further provides that unwelcome touching “means touching any part of the body in a manner which a reasonable person would perceive to be sexually motivated or sexually suggestive, or otherwise inappropriate in an academic or work environment.” (Emphasis added.) It includes “patting, or brushing parts of the body.” (Emphasis added.) The Board did not err in determining that the policy was violated. The testimony at the hearing revealed that plaintiff had leered at some of the girls, engaged in unwelcome touching on the buttocks of several girls, made sexually suggestive - 34 -  2020 IL App (2d) 190959 comments or innuendoes (pickle comment, looking good comments, the crude stick-your-butt-out and junk-in-your-trunk comments, and asking B.S. if she was pregnant and laughing at her), and harassed girls by engaging in physical conduct, such as close talking and straddling N.P.’s leg, that created an offensive educational environment. Certainly, a reasonable person would find plaintiff’s conduct over the two school years at issue inappropriate in a school setting. As several girls related, plaintiff’s conduct made them uncomfortable. After plaintiff touched B.S. on her buttocks and told her that she did a good job, she told him not to touch her. She testified that plaintiff’s action made her uncomfortable and that, after he allowed the girls to run in sports bras, she altered her dress and never wore sports bras or tight pants. H.P. testified that the team discussed how plaintiff invaded their personal space and some girls complained to her about it. A.C. testified that she was “creeped out” when plaintiff hit her on her buttocks with a lanyard. She also related that plaintiff said creepy things or looked girls up and down in a weird way, which made her feel uncomfortable. She did not tell her parents about the lanyard incident, because she was uncomfortable talking about it. S.W. testified that she was scared to say anything to plaintiff after he hit her on the buttocks. Ultimately, after she told her parents about the incident, she quit the team until Valdez was made head coach. Taken as a whole, as the Board reasonably found, plaintiff’s conduct violated Board policy. ¶ 118 Plaintiff’s argument that there was no conduct as egregious as fondling, caressing, molesting, or quid pro quo, is not well taken. Although previous cases finding immoral conduct might have involved more egregious conduct than plaintiff’s here, their holdings are not so limited nor do they necessarily imply that conduct such as plaintiff’s has a “legitimate basis in school policy or society” today. Fadler, 153 Ill. App. 3d at 1028-29 (defining immoral conduct). Our concept of what constitutes proper conduct in educational and other settings is constantly evolving. - 35 -  2020 IL App (2d) 190959 It is unquestionable that evolving norms of practice in education, as reflected in Board policy, do not condone the conduct at issue in this case. ¶ 119 In summary, the Board did not err in determining that there was sufficient cause for plaintiff’s dismissal. ¶ 120 2. Irremediability Finding ¶ 121 Next, plaintiff argues that the Board erred in determining that his conduct was irremediable. For the following reasons, we disagree. ¶ 122 In determining whether conduct is irremediable, the test set forth in Gilliland v. Board of Education of Pleasant View Consolidated School District No. 622, 67 Ill. 2d 143 , 153 (1977), applies in cases that do not involve Chicago teachers. 5 Crawley v. Board of Education of the City of Chicago, 2019 IL App (1st) 181367 , ¶ 19. Under Gilliland, the “test in determining whether a cause for dismissal is irremediable is [(1)] whether damage has been done to students, faculty or school, and [(2)] whether the conduct resulting in that damage could have been corrected had the teacher’s superiors warned [the teacher].” Gilliland, 67 Ill. 2d at 153 . If the teacher’s conduct is 5 In the case of Chicago schools, amendments to the School Code that were enacted over 20 years after Gilliland rendered the test unnecessary. See 105 ILCS 5/34-85(a) (West 2018) (“No written warning shall be required for conduct on the part of a teacher or principal that is cruel, immoral, negligent, or criminal or which in any way causes psychological or physical harm or injury to a student[,] as that conduct is deemed to be irremediable.” (Emphasis added.)); see also Ahmad, 365 Ill. App. 3d at 164 (no need to apply two-part Gilliland test for conduct that is immoral, criminal, or negligent, because it is deemed to be irremediable); Younge v. Board of Education of the City of Chicago, 338 Ill. App. 3d 522 , 533-34 (2003). - 36 -  2020 IL App (2d) 190959 remediable, he or she is entitled to a written warning before being dismissed. Fadler, 153 Ill. App. 3d at 1028. Without such a warning, a school board does not have jurisdiction to terminate a teacher’s employment for the causes given. Id. However, where the teacher’s conduct is irremediable, no written warning is required before initiating a dismissal action. Id. No written warning was given in this case. ¶ 123 a. First Prong ¶ 124 Turning to the first Gilliland prong—whether damage was been done to the students, faculty, or school—plaintiff argues that the Board erred in finding that his conduct harmed the students or the school. ¶ 125 The Board determined that plaintiff’s conduct harmed both the students and the school. As to the students, the Board found that plaintiff’s conduct was harmful “in itself, even without expert proof of physical injury, or psychological damage. The students’ testimony was proof enough.” As to the school, the Board found that plaintiff’s conduct impaired the district’s ability to carry out its stated policies concerning the education and treatment of its students. The negative press coverage also had the potential to harm the district’s reputation in the community. ¶ 126 Cases have held that, where students have suffered psychological damage, for example, the first prong is satisfied. Box, 191 Ill. App. 3d at 40; see also Board of Education of Argo-Summit School District No. 104 v. State Board of Education, 138 Ill. App. 3d 947 , 952 (1985); Fadler, 153 Ill. App. 3d at 1028. ¶ 127 Plaintiff argues that no expert opinion was offered here that the students, faculty, or school were harmed. He contends that Plascencia was not qualified as an expert and that her testimony of harm to the students was speculative. We reject this argument. Plaintiff cites no case requiring expert testimony of psychological or other injury, although there are cases where such testimony - 37 -  2020 IL App (2d) 190959 was presented. See, e.g., Argo-Summit, 138 Ill. App. 3d at 951-52 (teacher pinched several second- grade female students on the buttocks; first prong met, where parents testified to immediate effects of the teacher’s immoral conduct, including social withdrawal, hives, and inducing vomiting to avoid school; child psychiatrist testified such conduct has a highly traumatic effect on young girls; another psychiatrist testified that the long term effects on the victims’ growth could not be predicted and could range from no effect to very severe effect; held that there was sufficient evidence that the teacher’s conduct had immediate adverse psychological effects on the victims and the conduct was inherently harmful to the student-teacher relationship and to the faculty’s and the school’s reputation; “it is inconceivable that a situation would arise in which immoral conduct of any type between a teacher and student could be excused by reprimand”). Indeed, there are cases concluding that the first Gilliland prong is met where no such testimony was presented or it was discounted. See, e.g., Sparta, 217 Ill. App. 3d at 727-28 (male high school teacher wrote letters to two female students, expressing his affection for and physical attraction to them; clinical psychologist confirmed the sexual nature of the letters but the hearing officer did not give the testimony much weight; first prong met where, even entirely discounting the students’ and the psychologist’s testimony, it was “self-evident” from the letters that “such conduct has profound harm on the students involved, the student body as a whole, and the very operation of the school’s educational enterprise”); Fadler, 153 Ill. App. 3d at 1028 (elementary teacher charged with two incidents of immoral conduct, in that he fondled two students; first prong met; it was “clear [that the teacher’s] conduct caused irreparable damage to the students and the school itself”; while “no immediate medical or psychological treatment” was required for the students, “[t]his does not mean the Gilliland test has not been satisfied”; an expert did testify, but the court noted that testimony’s subject was that the damage from the sexual abuse could take years to manifest; also - 38 -  2020 IL App (2d) 190959 holding that teacher’s conduct was harmful to the faculty’s and school’s reputation); Massie v. East St. Louis School District No. 189, 203 Ill. App. 3d 965 , 973 (1990) (teacher allowed teenage girls to drink alcohol in his home; no expert testimony at hearing; held that first prong was met, where the teacher’s conduct “was detrimental not only to his relationship with his students, but also to the reputation of and faith in the faculty and school as a whole”). ¶ 128 Plaintiff also argues that, where a tenured teacher is dismissed for sexual misconduct, the conduct must be egregious and the harm unmistakable, and he contends that nothing comparable happened in this case. He again notes that there was no fondling, caressing, molesting, sexual advances, expressions of sexual attraction, quid pro quo, or testimony from students or experts that plaintiff’s conduct was harmful to the students. We reject plaintiff’s argument that the harm must be more egregious than what occurred in this case. Plaintiff cites case law involving more egregious circumstances. See Sparta, 217 Ill. App. 3d at 723-28 (overtly sexual letters to two students); Box, 191 Ill. App. 3d at 38 (touching of buttocks and breasts); Fadler, 153 Ill. App. 3d at 1025-26 (teacher placed his hand under a student’s clothes and touched her buttocks and squeezed the breast of another student); Argo-Summit, 138 Ill. App. 3d at 949-50 (teacher pinched several second-grade female students several times on the buttocks). However, none of the cases hold that only the most egregiously sexual conduct warrants a finding of harm under the first prong of Gilliland. Further, as noted above, norms of proper conduct in education and elsewhere evolve. Today, it cannot convincingly be argued that sexual harassment of the type in which plaintiff engaged did not cause harm to the students or negatively impact the school. ¶ 129 Plaintiff also argues that Plascencia’s testimony concerning harm was not informed (because she never spoke to plaintiff or the students and knew only what was in the executive summary) and that she was not qualified to opine as an expert. Thus, her opinions, plaintiff asserts, - 39 -  2020 IL App (2d) 190959 were speculative and unsubstantiated. We disagree. Again, expert opinion is not required. Plascencia testified that plaintiff’s conduct caused psychological damage to the students and noted that, in preparing for the case, many of the students wanted to forget about the experience, “which victims do.” She also testified that the fact that the students testified that the conduct was inappropriate showed that they were in turmoil. Plascencia also noted that it takes a lot for a child to come forward, a reference to the possibility of not being believed by an adult. She also testified that she believed that plaintiff’s conduct damaged the district’s reputation, noting that there was Facebook “chatter” about it, which had the effect of questioning whether the district could keep its students safe. (She acknowledged that the media became aware only after plaintiff was dismissed.) Plaintiff’s actions were offensive, violated school policy, made the students uncomfortable, caused some to change how they dressed around him, and harmed the school community by creating social media discussion about his conduct. ¶ 130 In any event, the Board, as noted, found that the students’ testimony alone was sufficient to show that the first Gilliland prong was met. We find no error with the Board’s analysis. Her opinions aside, Plascencia testified to the fact that, in preparing for the case, many of the students wanted to forget about the experience. This shows that the discomfort plaintiff’s conduct caused the students persisted several years after the conduct occurred, including after some of the students had graduated from WHS. Plascencia’s testimony also touched on the damage to the district, where she testified that there were Facebook comments about the allegations against plaintiff. We reject plaintiff’s argument that the fact that none of the complaining students left the team and that some of them asked him for recommendations shows that he did not harm them. He ignores that they testified that his conduct made them uncomfortable and caused some of them to change the way they dressed around him but that they loved the sport and continued to participate in it. Further, - 40 -  2020 IL App (2d) 190959 B.S. testified that she told Taylor that plaintiff had touched her buttocks but that nothing had been done. (She related this to her teammates.) The fact that she had reached out about plaintiff’s conduct shows that she was very troubled by his behavior. In the absence of action by the school, the students had to decide whether to tolerate plaintiff’s conduct in order to play a sport they loved or quit and lose the opportunity to participate in the sport. That they overwhelmingly chose to continue to participate in track does not diminish the degree of the harm plaintiff caused under the circumstances in this case. ¶ 131 Furthermore, there is authority for the proposition that, in cases involving sexually motivated conduct, the conduct, by its nature, is harmful to the students and the school. See Sparta, 217 Ill. App. 3d at 728 (first prong met where, even entirely discounting the students’ and the psychologist’s testimony, it was “self-evident” from the [teacher’s] “overtly sexual” letters that “such conduct has profound harm on the students involved, the student body as a whole, and the very operation of the school’s educational enterprise”). We agree with this approach. Although plaintiff’s conduct was not so egregious as to warrant police or DCFS action, its sexual nature was demeaning and inherently harmful to the students to whom it was directed. Sparta, 217 Ill. App. 3d at 728. ¶ 132 b. Second Prong ¶ 133 Turning to the second prong of Gilliland’s remediability test—whether the conduct resulting in the damage could have been corrected had the teacher been warned—some cases hold that an alternative formulation applies in certain circumstances, specifically, in cases involving conduct that is immoral or criminal. See, e.g., Sparta, 217 Ill. App. 3d at 729 (traditional second prong not appropriate where conduct at issue is “immoral conduct”); McCullough v. Illinois State Board of Education, 204 Ill. App. 3d 1082 , 1090 (1990) (second prong not applicable to criminal - 41 -  2020 IL App (2d) 190959 conduct); Fadler, 153 Ill. App. 3d at 1028-29 (second prong not applicable to teacher’s immoral conduct that “has no legitimate basis in school policy or society”); McBroom v. Board of Education of District No. 205, 144 Ill. App. 3d 463 , 473 (1986) (criminal conduct); Argo-Summit, 138 Ill. App. 3d at 952-53 (immoral conduct). In such cases, the second prong is altered to assess whether the effects of the conduct could have been corrected. Argo-Summit School, 138 Ill. App. 3d at 953 (“we are not persuaded that a warning could correct the psychological damage to the students or the damage to the reputation of the faculty and school district that was precipitated by [the teacher’s] immoral conduct”); Box, 191 Ill. App. 3d at 40-41 (unwanted touching of 10- and 11- year-olds; “warning could not have corrected the psychological damage to the students or the damage to the reputation of the faculty and school district”). The rationale for this alternative approach is that a written warning would serve no purpose and that the teacher’s conduct in such cases has no legitimate basis. Fadler, 153 Ill. App. 3d at 1029 (“It could always be argued that if told to do so, [the teacher] could refrain from improper touching.”). ¶ 134 Here, the Board determined that plaintiff’s conduct would likely not have been corrected had he received a warning and an opportunity to correct. It noted the 2012 warning where, after a complaint could not be substantiated against him, plaintiff was advised to be aware of the closeness of physical spaces in his classroom. The Board found that plaintiff should have known that this conduct as a male coach, “so full of sexual innuendo, was inappropriate and damaging to female athletes who depended on him for instruction, encouragement and support.” His conduct “demonstrate[d] such a fundamental lack of respect for the athletes as individuals rather than sexual objects, so deeply inappropriate for a male teacher coaching a girls’ team, that there is no reason to anticipate that a warning about his conduct would have spurred [plaintiff] to change.” - 42 -  2020 IL App (2d) 190959 ¶ 135 Plaintiff argues that his conduct was remediable. Any behavior or remarks that were insensitive, offensive, or inappropriate, he asserts, can be remediated, as can standing too close to athletes when speaking to them or using dated coaching techniques. Plaintiff contends that the issue here is the degree of harm. He notes that some of the students found his remarks or mannerisms inappropriate, offensive, rude, or insensitive, but none claimed that plaintiff harmed them or that they left the track team because of him or were afraid to travel with him to meets. This indicates, plaintiff urges, that any level of harm was low. He also asserts that there was no evidence that his conduct was so inherently harmful that it was irremediable. ¶ 136 We reject plaintiff’s argument. Plaintiff engaged in inappropriate verbal and physical conduct over a period of two years that constituted sexual harassment under Board policy sufficient to form the basis of a finding of immoral conduct warranting dismissal for cause under the School Code. The Board, applying the traditional formulation of the second Gilliland prong (i.e., whether plaintiff’s conduct could have been corrected had he been warned), correctly determined that plaintiff’s behavior causing harm to the students, faculty, and school could not have been corrected with a warning. Given the variety of offensive conduct in which plaintiff engaged—touching, verbal sexual innuendoes, lack of awareness of personal space that included an instance of straddling an athlete’s leg—over a period of at least two school years, there was no error in determining that plaintiff’s conduct would not have changed had he been warned. As the Board noted, the conduct evinced “a fundamental lack of respect for the athletes as individuals.” ¶ 137 Applying the alternative formulation of the second Gilliland prong, the result would have been the same, as the case law holds that the harm caused by immoral conduct involving touching students on a part of their bodies that can be reasonably construed as sexual in nature or other sexually motivated actions cannot be corrected. See, e.g., Sparta, 217 Ill. App. 3d at 728-29 (“A - 43 -  2020 IL App (2d) 190959 discharged teacher could always say that if only he [or she] had been told not to do something wrong he [or she] would have refrained from the offending conduct. This would virtually eliminate the ability of school districts to discharge teachers”; more appropriate focus is on “whether the effects of the conduct could have been corrected”; held that a warning would not have corrected the damage to the students, faculty, or school caused by the teacher’s conduct in writing “overtly sexual” letters to students); Fadler, 153 Ill. App. 3d at 1029 (teacher placed his hand under a student’s clothes and touched her buttocks and squeezed the breast of another student; teacher’s “conduct has no legitimate basis in school policy or society. No purpose would be served by giving the [teacher] a written warning”; holding that, under alternative formulation of second prong, conduct was irremediable because a warning would not have corrected psychological damage to the students or damage to the faculty or school; the teacher’s “conduct has no basis in school policy or society”). This is a sound approach, in our view. The harm plaintiff caused here by his demeaning treatment of the students who were entrusted to his care cannot be undone or corrected. ¶ 138 Plaintiff’s reliance on Swayne v. Board of Education of Rock Island School District No. 41, 144 Ill. App. 3d 217 (1986), and Board of Education of School District No. 131 v. State Board of Education, 99 Ill. 2d 111 (1983) (Slavin), is misplaced. In Swayne, an elementary teacher, with 16 years’ experience and “excellent” evaluations, was dismissed after a single incident in which she spanked a disruptive student, age six, several times in one day while also depositing him in a closet several times that day. School policy allowed corporal punishment if a parent had not exempted his or her child, and the parent in the case had not exempted her child. The sole issue on appeal was irremediability, and the reviewing court held that the plaintiff’s conduct was remediable, where the evidence of damage to the students and faculty was “slight at best,” the student was not physically harmed, there was “very thin and highly speculative” evidence of psychological harm - 44 -  2020 IL App (2d) 190959 to the student or those who witnessed the incident, and placing the student in the closet was not “serious misconduct.” Swayne, 144 Ill. App. 3d at 221-23. The court also concluded that the conduct would not repeat itself, where the plaintiff stated as such to the principal, she sent a letter to the school board repeating this, and a psychologist who examined the plaintiff testified that she could refrain from striking students if so instructed. Id. at 223. In Slavin, another older case, the supreme court held that an elementary school teacher’s conduct was remediable and that the school board had erred in dismissing him. Slavin, 99 Ill. 2d at 122 . The teacher had 17 years’ experience, an unblemished record, and a satisfactory rating. While teaching fourth graders, he had disciplinary issues with four students over a six-week period. He was too rough with the students and grabbed and shook one of them, leaving black and blue marks; he threw the student onto his desk, causing the top of the desk to fly up; other students sustained scratches, fingernail marks, and other injuries; and one student claimed that he hit his head on a radiator. At the time, corporal punishment was allowed under certain circumstances. The Slavin court held that the first Gilliland prong was not met, because the students did not sustain any serious injury, miss school, or require medical attention. Id. at 119-20 . Addressing the second prong, the court held that the teacher’s conduct could have been corrected with a warning, where an expert opined that it was possible that the teacher could be a useful teacher in the future. Id. at 121 . We find Swayne and Slavin of little value in assessing plaintiff’s case. They are distinguishable in that an expert testified in both cases that the teachers would not repeat the conduct. ¶ 139 We also reject plaintiff’s argument that he was in fact discharged for what the Board viewed as remediable conduct and that the Board used Levin’s discussion with him concerning the 2012 allegation as proof of prior discipline. The Board took no such position. In its findings, it noted that Levin had discussed with plaintiff his need to be aware of proximity issues with students. - 45 -  2020 IL App (2d) 190959 The Board did not find that this discussion was a prior disciplinary action. Indeed, the hearing officer found that the 2012 student complaint was “hearsay and is not accepted as true.” ¶ 140 In summary, the Board did not err in finding cause for plaintiff’s dismissal and determining that his conduct was irremediable. ¶ 141 B. Procedural Issues ¶ 142 Plaintiff argues next that the Board’s dismissal decision should be reversed because the Board did not observe several requirements of section 24-12 of the School Code. For the following reasons, we reject his arguments. ¶ 143 1. Whether the Board Approved a Motion with Specific Charges ¶ 144 Plaintiff asserts that the Board’s dismissal decision should be reversed because the Board failed to approve a motion with specific charges against him. ¶ 145 Section 24-12(d)(1) of the School Code provides that, where a school board seeks to dismiss a teacher in contractual continued service, including for cause, “the board must first approve a motion containing specific charges by a majority vote of all its members. Written notice of such charges, including a bill of particulars and the teacher’s right to request a hearing, must be mailed to the teacher and also given to the teacher either by certified mail, return receipt requested, or personal delivery with receipt within 5 days of the adoption of the motion.” 105 ILCS 5/24-12(d)(1) (West 2018). ¶ 146 Plaintiff maintains that the executive summary was not a “motion” to the Board with “specific charges.” Plascencia, he notes, relied on the executive summary when she recommended to the Board that plaintiff be dismissed. The Board’s first notice of the allegations against plaintiff was on May 9, 2017, when DeVonne circulated the executive summary to plaintiff and the Board. When the Board voted to dismiss plaintiff on May 9, 2017, it had only the executive summary, - 46 -  2020 IL App (2d) 190959 according to plaintiff, Plascencia’s recommendation, and Beatrice’s remarks. The summary, plaintiff argues, described plaintiff’s conduct as “sexual harassment,” without context. It was, he contends, an incomplete and misleading presentation to the Board. ¶ 147 Plaintiff also notes that the executive summary stated that he touched girls on “their buttocks” but not that it occurred at meets or practices and typically after the athlete had finished an event or performed well. The contact, he urges, was not sexual, and no athlete experienced the contact as sexual. He also notes that the executive summary did not mention that DCFS and the Waukegan Police Department independently investigated his conduct and that each concluded that charges were not warranted. Plaintiff also notes that the executive summary did not say that he made the junk-in-the-trunk remark to athletes as they practiced the shot put, that they knew that plaintiff was coaching them to use their lower bodies, or that no athlete thought plaintiff was approaching her sexually. ¶ 148 Plaintiff also takes issue with the allegations that he stood too close to people, arguing that this had long been commonly known and that he respected another person’s space when they stepped back. His manner was not intended or experienced as sexual. The summary also referenced the uncorroborated “sexual pencil” claim, implying that his classroom conduct was problematic but not mentioning that he had always been evaluated as a proficient teacher by the district. Plaintiff also notes that the summary alleged that he had sexually harassed a former assistant track coach, which led to her resignation. He asserts that this allegation was included to influence the Board but that it did not provide supporting facts. Nor was the charge in the notice of charges or bill of particulars. He also notes that the hearing officer excluded an offer of proof on the allegation because the Board did not include it in these documents. Nevertheless, plaintiff argues, the - 47 -  2020 IL App (2d) 190959 allegation damaged his case. He maintains that the Board’s dismissal decision was arbitrary and unfounded where it lacked sufficient information to fairly exercise its judgment. ¶ 149 We reject plaintiff’s argument. Both the two-page executive summary and the three-page supporting documents were presented to the Board on May 9, 2017. Despite their titles, the documents reasonably apprised plaintiff of the allegations against him. The executive summary informed the Board that the allegation that prompted the investigation was a parent’s complaint that plaintiff had inappropriately touched female track team athletes on the buttocks. Thus, it was clear that the allegations focused on his coaching. The executive summary also listed the findings of the investigation, as follows: four students were recipients of unwelcome touching on their buttocks; seven students were recipients of inappropriate comments (and the comments were quoted, including, among others, “You have all that junk in your trunk, you need to use it,” “Everyone knows you’re hot. You don’t need to brag about it,” and “What’s better than seeing girls in short shorts?” The summary also stated that 17 students witnessed unwelcome touching or inappropriate comments made to their teammates; that 8 students described feeling discomfort/creepiness or suspected “other” intentions from plaintiff; 5 students on the team were also current students in his class; plaintiff “consistently violates personal space and looks/stares at female students in a way that makes them uncomfortable”; and he sexually harassed a former WHS assistant track coach, which led to her resignation. DeVonne recommended that plaintiff be terminated from teaching and coaching “for sexual harassment of female students.” The supporting documents contained a factual timeline of the allegations and the investigation, a summary of the 2012 investigation, and a summary of the relevant Board policies. We disagree that the documents were incomplete or misleading. Plaintiff’s assertion that the contact was not sexual and that no athlete experienced it that way is belied by the nature of the contact: he intentionally touched the - 48 -  2020 IL App (2d) 190959 girls on their buttocks, and some of the girls complained that he was creepy and/or looked at them in a way that made them uncomfortable. Further, we reject his argument that the documents did not clarify the context of the junk-in-your-trunk comment, that it was made to the athletes when they practiced the shot put and they knew that he meant that they should use their lower bodies. The context, as noted, was clear in the documents, and the fact that he intended the comment to be a coaching tip does not take away from the fact that it was crude and inappropriate and was noted as such by the athletes. ¶ 150 Plaintiff’s argument that the Board did not hear that it was commonly known that he was a close talker is not relevant to whether that conduct was inappropriate. As to his teaching evaluations, they were not directly relevant to the allegations, which concerned his conduct as a coach. Finally, plaintiff’s argument that the allegation concerning the assistant coach damaged his case is pure speculation. The allegations concerning the athletes were the focus of the case against him. ¶ 151 In summary, the Board approved a motion with sufficiently specific charges. ¶ 152 2. Timely Mailing of Notice of Charges and Bill of Particulars ¶ 153 Next, plaintiff argues that the Board’s dismissal decision should be reversed because the Board did not mail to him notice of the charges and a bill of particulars within five days of its dismissal order. 105 ILCS 5/24-12(d)(1) (West 2018). Rather, it was one day late. He maintains that the statute requires strict compliance. Prejudice to the teacher does not, he contends, inform the analysis. The Board, he argues, cannot dismiss a tenured teacher for cause unless it complies with the School Code, which it did not do here. ¶ 154 Again, section 24-12(d)(1) of the School Code provides that written notice of charges, “including a bill of particulars and the teacher’s right to request a hearing, must be mailed to the - 49 -  2020 IL App (2d) 190959 teacher and also given to the teacher either by certified mail, return receipt requested, or personal delivery with receipt within 5 days of the adoption of the motion.” 105 ILCS 5/24-12(d)(1) (West 2018). A “day” means a “calendar day.” 23 Ill. Adm. Code 51.10 (eff. Nov. 3, 2014). ¶ 155 We reject plaintiff’s argument that section 24-12 of the School Code requires strict compliance. We agree with the Board that Rolando v. School Directors of District No. 125, 44 Ill. App. 3d 658 (1976), controls. In Rolando, the court held that the five-day rule for the delivery of a bill of particulars did not deprive the board of jurisdiction and that compliance with the statute is directory, not mandatory. Id. at 663. The court also noted that there was no prejudice to the plaintiff in that case by the tardy compliance (i.e., a two-day delay) with his request for a bill of particulars, where the plaintiff had a hearing (afterwards), was present at that hearing, and was represented by counsel. Id. Here, there was only a one-day delay and there was similarly no prejudice to plaintiff, where he subsequently had a hearing before the hearing officer and was represented by counsel. Plaintiff does not address Rolando. ¶ 156 In summary, plaintiff’s timely-mailing challenge fails. ¶ 157 III. CONCLUSION ¶ 158 For the reasons stated, the judgment of the circuit court of Lake County is affirmed. ¶ 159 Affirmed. - 50 -  2020 IL App (2d) 190959 No. 2-19-0959 Cite as: Pacernick v. Board of Education of the Waukegan Community Unit School District No. 60, 2020 IL App (2d) 190959 Decision Under Review: Appeal from the Circuit Court of Lake County, No. 19-MR-49; the Hon. David P. Brodsky, Judge, presiding. Attorneys Steven P. Blonder and Jonathan L. Loew, of Much Shelist, P.C., for of Chicago, for appellant. Appellant: Attorneys Joshua G. Vincent and Linda K. Horras, of Hinshaw & Culbertson for LLP, of Chicago, for appellee. Appellee: - 51 -

2020-12-01 23:03:58.152572+00

http://www.illinoiscourts.gov/Opinions/AppellateCourt/2020/1stDistrict/1181795.pdf

2020 IL App (1st) 181795 FOURTH DIVISION Filing Date November 25, 2020 No. 1-18-1795 ______________________________________________________________________________ IN THE APPELLATE COURT OF ILLINOIS FIRST JUDICIAL DISTRICT ______________________________________________________________________________ CE DESIGN LTD., an Illinois Corporation, Individually ) and as the Representative of a Class of Similarly Situated ) Appeal from the Persons, ) Circuit Court of ) Cook County. Plaintiff-Appellant, ) ) No. 06 CH 27638 v. ) ) The Honorable C&T PIZZA, INC.; JOSEPH CIANCIOLO; and FRAN ) Sanjay Tailor, CIANCIOLO, ) Judge, Presiding. ) Defendants-Appellees. ) JUSTICE HALL delivered the judgment of the court, with opinion. Presiding Justice Gordon and Justice Reyes concurred in the judgment and opinion. OPINION ¶1 Plaintiff CE Design, Ltd., appeals from an order of the circuit court, which granted defendants’ motion for summary judgment on plaintiff’s class action complaint, based upon violations of the Telephone Consumer Protection Act of 1991 (TCPA) ( 47 U.S.C. § 227 (b)(1)(C) (2006)) and the Consumer Fraud and Deceptive Business Practices Act (Consumer Fraud Act) No. 1-18-1795 (815 ILCS 505/2 (West 2018)) and conversion. For the reasons that follow, we affirm the circuit court’s judgment. ¶2 I. BACKGROUND ¶3 Much of the background relative to this case was set forth in a prior interlocutory appeal, CE Design Ltd. v. C&T Pizza, Inc., 2015 IL App (1st) 131465 (CE Design I). In that appeal, defendants appealed class certification in an action alleging violation of the TCPA, which makes it unlawful to “ ‘use any telephone facsimile machine, computer, or other device to send, to a telephone facsimile machine, an unsolicited advertisement.’ ” CE Design I, 2015 IL App (1st) 131465 , ¶ 1 (quoting 47 U.S.C. § 227 (b)(1)(C)). We will recite those facts that are relevant to the disposition of this appeal. ¶4 Defendant C&T Pizza, doing business as Great Chicago Pizza, is a pizza delivery restaurant in Schaumburg, Illinois. Id. ¶ 3. C&T Pizza is owned by defendants Joseph and Fran Cianciolo. In March 2006, a fax broadcaster, Business to Business Solutions (B2B), 1 sent a fax to defendant, advertising its services. Id. B2B is based in New York and run by Caroline Abraham, who works with a Romanian company known as Macaw to send fax advertisements in the United States. Id. Joseph responded to B2B’s advertisement and ultimately hired the company to advertise his pizza business. Id. ¶5 B2B created a fax advertisement for the business after Joseph completed a document from B2B with information and details about his pizza business. Id. ¶ 4. Defendant paid B2B $268 to send out 5000 fax advertisements, and B2B planned on transmitting the fax advertisements to zip codes and area codes near the pizza business. Id. On May 4, 2006, B2B sent a fax of defendant’s advertisement to 2765 fax numbers, of which 1935 were successfully 1 B2B was not named as a party in the proceedings below and is not a party to this appeal. -2- No. 1-18-1795 transmitted. Id. The next day, B2B sent a fax of defendant’s advertisement to 2729 fax numbers, of which 1893 were successfully transmitted. Id. Plaintiff received faxes on both days. Id. ¶ 5. ¶6 Plaintiff is a small civil engineering firm based in the Chicago area that engages in plaintiff class-action litigation involving the TCPA. Id. Plaintiff’s business address is located approximately seven miles from the pizza restaurant’s business address. ¶7 In December 2006, plaintiff filed suit against C&T Pizza and Joseph and Fran Cianciolo (collectively, defendants), seeking statutory damages for violations of the TCPA and the Consumer Fraud Act and for conversion. Id. ¶ 6. Plaintiff also filed a motion for class certification, which it amended twice. ¶8 The record indicates that, in January 2011, defendants filed a response to plaintiff’s second amended motion for class certification. Attached to defendants’ response was Joseph Cianciolo’s affidavit (2011 affidavit). In this affidavit, Joseph averred that “[w]hile a large majority of the restaurant’s customers were located within two miles of the restaurant, all of the restaurant’s customers were located within four miles of the restaurant.” He also averred that defendant never delivered to anyone outside of four miles of the restaurant and “never delivered to anyone in Rolling Meadows.” Finally, Joseph averred that he “instructed B2B to only send the faxes to those businesses and individuals who resided within a two-mile radius of the restaurant.” ¶9 In April 2013, the circuit court granted plaintiff’s motion for class certification in a memorandum opinion and order certifying the class. Id. Defendant filed a petition for leave to appeal the class certification, which was granted. Id. ¶ 7. ¶ 10 Pertinent to the issues raised in the current appeal, one of defendants’ arguments in CE Design I was that “plaintiff resided outside the geographical area which B2B was authorized to transmit defendant’s fax advertisements because plaintiff was located more than five miles from -3- No. 1-18-1795 the pizza restaurant.” Id. ¶ 18. Defendants further claimed that “any fax advertisements sent beyond a two-mile radius of the pizza restaurant were not authorized [by them].” Id. However, this court found that nothing in the record supported defendant’s position and that defendant cited “nothing where Cianciolo instructed B2B to limit the geographic target area to a two-mile radius of the pizza restaurant.” Id. ¶ 11 This court noted: “The only evidence defendant points to in support of this claim is Cianciolo’s recollection of a telephone conversation he had with someone at B2B, wherein they discussed it was ‘supposed to be like a couple of miles from the business.’ This is hardly a strict instruction to B2B to limit all faxes to exactly two miles. Moreover, this initial conversation occurred on March 1, 2006, and Cianciolo did not finally agree to have B2B transmit the fax advertisements on defendant’s behalf until two months later on May 3, 2006. In the meantime, Cianciolo exchanged numerous faxes with B2B and had a second telephone conversation with B2B where he never again mentioned anything about geography, let alone a strict two-mile limitation on B2B’s authority.” Id. ¶ 19. ¶ 12 This court further found that “B2B did exactly what it agreed to do and transmitted defendant’s advertisements to the fax numbers in its database that were as close to the zip code of defendant’s restaurant as possible. *** There is no basis to contest liability under the TCPA for faxes that defendant admits to have authorized B2B to send.” Id. ¶ 20. ¶ 13 This court further found that B2B had the apparent authority to send the unsolicited fax advertisements and that the trial court did not abuse its discretion by finding that B2B sent defendants’ faxes to plaintiff on defendants’ behalf where Joseph admitted that he engaged B2B -4- No. 1-18-1795 to send the fax advertisements. Id.¶ 23. Moreover, the evidence indicated that B2B was acting with apparent authority under the TCPA as defined by the Federal Communications Commission (FCC), and we upheld the trial court’s decision to certify the class. Id. ¶¶ 23, 32. ¶ 14 Following the issuance of this court’s opinion in May 2015, the circuit court closed discovery, and the parties filed cross-motions for summary judgment. ¶ 15 In support of their motion for summary judgment, defendants attached another affidavit from Joseph (2017 affidavit). In the 2017 affidavit, Joseph restated his prior averments and further averred that C&T never delivered to anyone in Rolling Meadows because the further away the customer was from the restaurant, the more likely it was that the pizza would be cold by the time it was delivered. Additionally, Joseph averred that (1) he was the individual who responded to B2B’s fax solicitation that advertised its services, (2) he helped B2B create the faxes that were sent out on behalf of the restaurant, (3) the faxes were developed primarily to cater to existing customers of the restaurant, and (4) he instructed B2B to only send the faxes to those businesses and individuals who resided within a two mile radius of the restaurant. ¶ 16 Plaintiff did not present a counter-affidavit in support of its motion for summary judgment. ¶ 17 On February 13, 2018, the circuit court granted defendants’ motion for summary judgment, dismissing all counts of plaintiff’s complaint. ¶ 18 In dismissing count I based upon the TCPA, the circuit court found that plaintiff’s reliance on CE Design I as “the law of the case that B2B did not exceed its authority in sending facsimiles outside of the two-mile radius” was a misapplication of the law rendered in that interlocutory appeal. The circuit court reasoned that the law of the case doctrine applies if the facts in a particular case remain the same. Citing Cruz v. Unilock Chicago, Inc., 383 Ill. App. 3d -5- No. 1-18-1795 752, 764 (2008), the court noted that it may be necessary for a court to make certain findings pertaining to the merits of the case in order to determine whether to certify the class, but those determinations are not binding. ¶ 19 The circuit court further noted (1) that appellate review of the certification of a class is limited to the narrow question of whether litigation should proceed as a class action-an issue distinct from resolving any claim on its merits, (2) that rulings on class certification accept the plaintiffs’ allegations as true, and (3) that inferences therefrom are drawn in favor of class certification. However, the circuit court found that when the appellate court affirmed the class certification in CE Design I, its rulings in that opinion did not become the law of the case because that opinion “was not based on the fully developed record that is now before the Court.” ¶ 20 The circuit court noted that subsequent to this court’s interlocutory class certification in CE Design I, issued in May 2015, additional evidence was submitted—namely, the 2017 affidavit. The circuit court further noted that Joseph’s averment that he only wanted the faxes to be sent within two miles of the restaurant was a practical limitation in light of Joseph’s further testimony that the large majority of their business was delivery and they limited their delivery business to Schaumburg and Hoffman Estates for various reasons, most notably that the pizza would usually get cold if it had to be delivered for long distances, and traffic in that area was frequently heavy. ¶ 21 The circuit court rejected plaintiff’s argument that the 2017 affidavit was inconsistent with his prior deposition testimony and should have been stricken. The court found that the 2017 affidavit expanded and reaffirmed Joseph’s prior deposition testimony and that, even if the 2017 affidavit was inconsistent because it included other aspects of his conversation with B2B that -6- No. 1-18-1795 was not offered in his deposition, it was not contradictory on the seminal question of the geographic limitation. ¶ 22 The circuit court concluded that “[w]ith the benefit of Mr. Cianciolo’s affidavit (which the Appellate Court did not have when it affirmed class certification), and with no contradictory evidence proffered by CE Design, there is no genuine issue of material fact as to whether B2B exceeded its authority when it sent fax advertisements beyond two miles from C&T’s pizza delivery restaurant. As such, the faxes allegedly sent to CE Design were not ‘on behalf of’ C&T within the meaning of TCPA.’ ” The court then granted summary judgment in favor of defendants on count I. ¶ 23 As to counts II and III of plaintiff’s complaint, based upon conversion and the Consumer Fraud Act, the court granted summary judgment in favor of defendants because plaintiff did not produce any evidence that it suffered actual harm. Plaintiff does not raise any issues regarding the dismissal of those counts in this appeal. ¶ 24 The summary judgment order also granted defendants’ request for attorney fees and expenses incurred related to the deposition of nonparty Caroline Abraham. On two separate occasions, defendant’s counsel flew to New York to attend Abraham’s deposition, and the deposition did not proceed. In granting defendant’s request for reasonable attorney’s fees, the circuit court noted “[w]hile CE Design’s counsel served notices of both of Ms. Abraham’s scheduled depositions, he failed to cause a subpoena to issue for either of them.” Plaintiff does not raise any issues regarding the circuit court’s grant of reasonable attorney fees and costs to defendants in this appeal. -7- No. 1-18-1795 ¶ 25 On July 27, 2018, the circuit court entered the summary judgment order as final and appealable. On August 20, 2018, plaintiff filed its timely notice of appeal. ¶ 26 II. ANALYSIS ¶ 27 On appeal, plaintiff contends that the circuit court erred when it (1) determined that this court’s decision in CE Design I was not the law of the case and (2) granted summary judgment in favor of defendants and denied plaintiff’s motion for summary judgment, finding that defendants did not authorize B2B to send faxes more than two miles away from the restaurant. ¶ 28 A. Law-of-the-Case Doctrine ¶ 29 Plaintiff first contends that the circuit court erred when it determined that this court’s decision in CE Design I was not the law of the case regarding whether B2B acted with defendants’ authority in sending out the faxes. Plaintiff contends that that decision was the law of the case because the record has not changed since this court affirmed class certification in its May 2015 opinion. Plaintiff contends that the 2017 affidavit did not contain any new information about Joseph’s instruction to B2B regarding the geographical area to cover with the faxes. Plaintiff argues that the circuit court incorrectly rejected this court’s findings of fact set forth in the interlocutory appeal because they were made in the context of class certification. Though the interlocutory appeal was from a class certification order, plaintiff argues that the factual and legal question for review was the validity of plaintiff’s claim in the face of defendants’ argument that they did not authorize B2B to send faxes outside a strict two-mile radius from the restaurant. ¶ 30 In response, defendants contend that a ruling on class certification is not a ruling on the merits of the case. Defendants assert that, in its class certification decision, the circuit court expressly noted that it was not making any determinations on the merits of the case and that any findings pertaining to the merits of the case in order to determine whether to certify the class, -8- No. 1-18-1795 those determinations are not binding. Additionally, defendants argue that appellate courts are not fact finders and, thus, made no findings on the merits because it would have been improper to do so within the context of deciding class certification. ¶ 31 The law-of-the-case doctrine protects the parties’ settled expectations, ensures uniformity of decisions, maintains consistency during the course of a single case, effectuates the proper administration of justice, and brings litigation to an end. Radwill v. Manor Care of Westmont, IL, LLC, 2013 IL App (2d) 120957 , ¶ 8. ¶ 32 The law-of-the-case doctrine limits relitigation of a previously-decided issue in the same case and applies not only to the court’s explicit decisions, but also those issues decided by necessary implication. Rommel v. Illinois State Toll Highway Authority, 2013 IL App (2d) 120273 , ¶ 15. The doctrine applies to questions of law on remand to the trial court, as well as on subsequent appeals to the appellate court. Id. There are two exceptions to the law-of-the-case doctrine: (1) when, after a reviewing court’s original decision, a higher court makes a contrary ruling on the same issue and (2) when a reviewing court finds that its prior decision was palpably erroneous. Id. ¶ 17. Moreover, a ruling will not be binding in a subsequent stage of litigation when different issues are involved, different parties are involved, or the underlying facts have changed. American Service Insurance Co. v. China Ocean Shipping Co. (Americas), Inc., 2014 IL App (1st) 121895 , ¶ 17. Application of the law-of-the-case doctrine is a question of law, and our review is de novo. Rommel, 2013 IL App (2d) 120273 , ¶ 14. ¶ 33 Here, this court reviewed the circuit court’s grant of class certification in CE Design I. Because that decision was a decision on the merits of the interlocutory order only, it was not a decision on the merits and did not have a preclusive effect on other issues that could be raised -9- No. 1-18-1795 later on direct appeal. Rosolowski v. Clark Refining & Marketing, 383 Ill. App. 3d 420 , 428 (2008). ¶ 34 A ruling on class certification is not a ruling on the merits of the case. See Chultem v. Ticor Title Insurance Co., 2015 IL App (1st) 140808 , ¶¶ 47-50. Decisions on appeal related to class certification are typically not decided on the merits but are limited in scope to whether class certification is appropriate. See Chultem, 2015 IL App (1st) 140808 , ¶¶ 47-50. ¶ 35 In CE Design I, as noted previously, this court only addressed the issue of whether the circuit court properly certified the class. At that time, we rejected defendants’ arguments that plaintiff resided outside the geographical area which B2B was authorized to transmit the fax advertisements as it related to certification of the class. In doing so, we noted that there was nothing in the record to support this claim except Joseph’s statement in his deposition. ¶ 36 After remand, the case continued in the trial court, including additional discovery. Both parties subsequently filed cross-motions for summary judgment. Joseph’s 2017 affidavit was attached to defendants’ motion and provided additional information regarding B2B’s authority to send faxes beyond a two-mile radius away from the restaurant. ¶ 37 While defendants raised several issues in the interlocutory appeal, our final decision only affected the merits of the class certification and not the ultimate issue in controversy, namely whether defendants authorized B2B to send faxes outside of a two-mile radius of the restaurant and violated the TCPA. Plaintiff’s contention is unreasonable and a misapplication of the law pertaining to interlocutory appeals and the law-of-the-case doctrine. We find that the circuit court properly concluded that our decision in CE Design I was not the law of the case with regards to the merits of the underlying controversy. ¶ 38 B. Summary Judgment - 10 - No. 1-18-1795 ¶ 39 Plaintiff next contends that the circuit court erred when it granted defendants’ motion for summary judgment and denied its summary judgment motion, finding that defendants did not authorize B2B to send faxes more than two miles away from defendant’s restaurant under the TCPA. ¶ 40 Summary judgment is appropriate “if the pleadings, depositions, 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 a judgment as a matter of law.” (Internal quotation marks omitted.) Irwin Industrial Tool Co. v. Department of Revenue, 238 Ill. 2d 332 , 339-40 (2010); 735 ILCS 5/2-1005(c) (West 2018). The purpose of summary judgment is to determine whether there are triable issues of fact. Hartz Construction Co. v. Village of Western Springs, 2012 IL App (1st) 103108 , ¶ 23. We review the circuit court’s decision to grant summary judgment de novo. Loncarevic & Associates, Inc. v. Stanley Foam Corp., 2017 IL App (1st) 150690 , ¶ 23; Evans v. Brown, 399 Ill. App. 3d 238 , 244 (2010). ¶ 41 In reviewing a circuit court’s ruling on a motion for summary judgment, the appellate court examines the record anew to determine whether a material question of fact exists. CE Design, Ltd. v. Speedway Crane, LLC, 2015 IL App (1st) 132572 , ¶ 20; Coole v. Central Area Recycling, 384 Ill. App. 3d 390 , 396 (2008). ¶ 42 The TCPA provides in relevant part: “It shall be unlawful for any person within the United States, or any person outside the United States if the recipient is within the United States *** to use any telephone facsimile machine, computer, or other device to send, to a telephone facsimile machine, an unsolicited advertisement.” 47 U.S.C. § 227 (b)(1)(C). The plain language of the TCPA assigns direct liability to “any person” who sends an unsolicited fax advertisement. Id.; Uesco Industries, Inc. v. Poolman of Wisconsin, Inc., 2013 IL App (1st) 112566 , ¶ 54. - 11 - No. 1-18-1795 ¶ 43 Although the Act does not explicitly assign vicarious liability, the United States Supreme Court has held that, “when Congress creates a tort action, it legislates against a legal background of ordinary tort-related vicarious liability rules and consequently intends its legislation to incorporate those rules.” Meyer v. Holley, 537 U.S. 280 , 285 (2003); Uesco Industries, 2013 IL App (1st) 112566 , ¶ 54. Section 217 of the TCPA, titled “Agents’ acts and omissions; liability of carrier,” codifies the common law respondeat superior doctrine states in pertinent part: “In construing and enforcing the provisions of this chapter, the act, omission, or failure of any officer, agent, or other person acting for or employed by any common carrier or user, acting within the scope of his employment, shall in every case be also deemed to be the act, omission, or failure of such carrier or user as well as that of the person.” (Emphasis added.) 47 U.S.C. § 217 (2006); Uesco Industries, 2013 IL App (1st) 112566 , ¶ 54. ¶ 44 “There is nothing in the plain language of the Act nor its legislative history suggesting Congress intended to impose liability on a party that did not send an unsolicited fax or authorize a third party to send an unsolicited fax on its behalf.” Uesco Industries, 2013 IL App (1st) 112566 , ¶ 55. The FCC implemented this prohibition by promulgating 47 C.F.R. § 64.1200 (a)(3) (2008), which defines a “sender” as “the person or entity on whose behalf a facsimile unsolicited advertisement is sent or whose goods or services are advertised or promoted in the unsolicited advertisement” ( 47 C.F.R. § 64.1200 (f)(8) (2008)).Thus, the FCC has also ruled that the Act incorporates vicarious liability. Uesco Industries, 2013 IL App (1st) 112566 , ¶55. ¶ 45 In this case, it is undisputed that plaintiff received two faxes from B2B, advertising the pizza restaurant. It is also undisputed that defendants authorized B2B to send faxes on its behalf. The parties dispute, however, whether B2B had authority to send the faxes on defendants’ behalf - 12 - No. 1-18-1795 outside of a two-mile radius, thereby imputing vicarious liability to defendant. More specifically, the parties dispute whether B2B had the authority to send the two faxes to plaintiff, who was located more than seven miles away from the restaurant. ¶ 46 We note that the 2017 affidavit attached to defendants’ motion for summary judgment was uncontested as plaintiff failed to file a counter-affidavit. “[F]acts contained in an affidavit in support of a motion for summary judgment which are not contradicted by counteraffidavit are admitted and must be taken as true for purposes of the motion.” Purtill v. Hess, 111 Ill. 2d 229 , 241 (1986). “If a party moving for summary judgment supplies facts which, if not contradicted, would entitle such party to a judgment as a matter of law, the opposing party cannot rely on his pleadings alone to raise issues of material fact.” Id. at 240-41 . ¶ 47 Here, Joseph’s 2017 affidavit averred that he did not authorize B2B to send faxes outside of a two-mile radius. Taking this allegation as true, we find that B2B did not have the authority to send the faxes to plaintiff on defendants’ behalf. Because plaintiff failed to file a counter- affidavit, there was no issue of genuine material fact as to whether Joseph authorized B2B to send the faxes beyond two miles. Thus, defendants did not violate the TCPA, and the trial court properly granted summary judgment in their favor. ¶ 48 III. CONCLUSION ¶ 49 For the foregoing reasons, we affirm the judgment of the circuit court of Cook County. ¶ 50 Affirmed. - 13 - No. 1-18-1795 No. 1-18-1795 Cite as: CE Design Ltd. v. C&T Pizza, Inc., 2020 IL App (1st) 181795 Decision Under Review: Appeal from the Circuit Court of Cook County, No. 06-CH- 27638; the Hon. Sanjay Tailor, Judge, presiding. Attorneys Phillip A. Bock, Robert M. Hatch, and Tod A. Lewis, of Bock, for Hatch, Lewis & Oppenheim LLC, of Chicago, for appellant. Appellant: Attorneys James K. Borcia, of Tressler LLP, of Chicago, for appellees. for Appellee: - 14 -

2020-12-01 23:03:58.774782+00

http://www.illinoiscourts.gov/Opinions/AppellateCourt/2020/5thDistrict/5190279.pdf

2020 IL App (5th) 190279 NOTICE Decision filed 12/01/20. The text of this decision may be NOS. 5-19-0279 and 5-20-0021 cons. changed or corrected prior to the filing of a Peti ion for Rehearing or the disposition of IN THE the same. APPELLATE COURT OF ILLINOIS FIFTH DISTRICT ______________________________________________________________________________ GREGORY L. BURDESS and LISA BURDESS, ) Appeal from the ) Circuit Court of Plaintiffs-Appellees, ) St. Clair County. ) v. ) No. 16-L-189 ) COTTRELL, INC.; GENERAL MOTORS, LLC; ) and AUTO HANDLING CORPORATION, ) ) Defendants ) Honorable ) Christopher T. Kolker, (Continental Indemnity Company, Intervenor-Appellant). ) Judge, presiding. ______________________________________________________________________________ JUSTICE OVERSTREET delivered the judgment of the court, with opinion. Presiding Justice Welch and Justice Boie concurred in the judgment and opinion. OPINION ¶1 This is a consolidated appeal of orders entered by the circuit court of St. Clair County on June 20, 2019, and December 17, 2019, holding the appellant, Continental Indemnity Company (Continental), in contempt of court for failing to comply with discovery orders entered pursuant to Illinois Supreme Court Rule 213 (eff. Jan. 1, 2018) and Rule 214 (eff. July 1, 2018) and for failing to comply with an order to produce discovery sought by the plaintiffs, Gregory L. Burdess (Gregory) and Lisa Burdess, in a discovery deposition subpoena. For the following reasons, we affirm in part and reverse in part and remand for further proceedings. 1 ¶2 BACKGROUND ¶3 On April 4, 2016, the plaintiffs filed a seven-count complaint against the defendants, Cottrell, Inc. (Cottrell), General Motors, LLC (GM), and Auto Handling Corporation (AHC), seeking damages for employment-related injuries Gregory sustained on April 28, 2014, when he fell from the deck of a vehicle transportation rig while working for Jack Cooper Transport Company, Inc. (Jack Cooper). ¶4 On July 9, 2018, Continental filed a motion for leave to file a petition to intervene. The motion provided that the request was brought pursuant to section 2-408 of the Code of Civil Procedure (Code) (735 ILCS 5/2-408 (West 2018)) for the purpose of allowing Continental to protect and secure a lien as provided in section 5(b) of the Workers’ Compensation Act (Act) (820 ILCS 305/5(b) (West 2018)). The motion alleged that Gregory brought a workers’ compensation claim against his employer, Jack Cooper; that Continental was the workers’ compensation insurance carrier for Jack Cooper; that Continental had paid workers’ compensation benefits to or on behalf of Gregory; and that Continental sought leave to intervene to secure a lien on any award or judgment with which the plaintiffs may be compensated in the litigation against the defendants. ¶5 Continental requested, inter alia, that all orders of the circuit court be made to indemnify, protect, and secure Continental’s lien out of any fund or judgment with which the defendants may compensate the plaintiffs and that the circuit court order that no funds from any settlement of the claim be disbursed without Continental’s approval. ¶6 On August 14, 2018, the circuit court granted Continental’s motion for leave to file a petition to intervene, without objection. On August 30, 2018, Continental entered its appearance as intervenor. On October 4, 2018, the plaintiffs issued interrogatories to Continental, pursuant to Illinois Supreme Court Rule 213 (eff. Jan. 1, 2018) and a request for production of documents, 2 pursuant to Illinois Supreme Court Rule 214 (eff. July 1, 2018). Notably, in the body of these pleadings—albeit not in the caption—the plaintiffs referred to Continental as a “Defendant.” 1 ¶7 On January 14, 2019, Continental served its answer and response to the plaintiffs’ interrogatories and request for production of documents. In the answer and response, Continental asserted the following objection to each interrogatory and request: “Intervenor objects to answering written discovery or participating in this lawsuit beyond its limited role as provided for in 820 ILCS 305/5(b), which provides that its intervention is for purposes of insuring that all orders of court after hearing or judgment shall be made for the protection of intervenor and its lien interest. See also Jackson v. Polar-Mohr, 115 Ill. App. 3d 571 , 574 ([1983]). (Since the employer’s interest in the judgment is in the form of a lien … his intervention is limited to protecting the lien and all orders of the Court after hearing and judgment.)” 2 Notwithstanding the nonparty objection, Continental acknowledged that it was subject to the subpoena power of the circuit court and thus produced an electronic file containing materials related to Gregory’s workers’ compensation claim, along with an itemization of the workers’ compensation benefits paid to Gregory for which Continental was asserting its lien. ¶8 On January 29, 2019, the plaintiffs filed a motion to compel discovery and for sanctions for Continental’s failure to comply with their discovery requests. The motion alleged that by intervening as the workers’ compensation lien holder, Continental “became a party to this action and was subject to *** discovery rules.” Citing Illinois Supreme Court Rule 213 (eff. Jan. 1, 2018) and Rule 214 (eff. July 1, 2018), the plaintiffs alleged in the motion to compel that, notwithstanding Continental’s production of the electronic workers’ compensation file to support its lien, 1 The captions identify the defendants as Cottrell, GM, and AHC. 2 This objection is hereinafter referenced as the “nonparty objection.” 3 Continental failed to provide verifications to the interrogatories and request for production. The plaintiffs alleged that Continental’s responses were in bad faith and requested the circuit court to, inter alia, enter an order compelling Continental to fully respond to the discovery requests without objection and warning Continental that any further noncompliance “will result in the imposition of severe and extreme sanctions.” ¶9 On February 12, 2019, Continental filed a response to the motion to compel discovery and for sanctions. Continental indicated that it had, in fact, responded to each discovery request with the nonparty objection, as contemplated by Rules 213 and 214, except for the production of the nonprivileged materials associated with Gregory’s workers’ compensation claim for which it was asserting its lien. Continental reiterated that it did not become a party to the litigation by intervening and that its rights and responsibilities were limited to protecting its lien, pursuant to section 5(b) of the Act (820 ILCS 305/5(b) (West 2018)). ¶ 10 On March 11, 2019, after a hearing, the circuit court entered an order granting the plaintiffs’ motion to compel, overruling Continental’s objections, ordering Continental to fully respond to the discovery within 14 days, and denying the plaintiffs’ request for sanctions. ¶ 11 On March 25, 2019, Continental served its answer and response to the interrogatories and request for production of documents in which Continental reasserted the nonparty objection. Subject to the nonparty objection, Continental answered 15 of the 16 interrogatories. Interrogatory number 13 requested Continental to “[s]tate the names and job titles of all persons in your corporate control group and set forth all facts which support the control group status for each.” Continental objected to interrogatory number 13 as follows: “Objection, no control group within the corporate structure of Intervenor has been implicated in this lawsuit and, therefore, this Interrogatory is 4 vague, ambiguous[,] and unanswerable and neither seeks relevant information nor information reasonably calculated to lead to the discovery of relevant information.” ¶ 12 Also subject to the nonparty objection, Continental responded to 45 of the 48 requests to produce and asserted additional objections to request numbers 1, 13, and 42. Request number 1 sought: “Copies of any workers’ compensation claims, and reports of injuries completed by supervisors and/or drivers employed by [Jack Cooper] and its corporate affiliates in your possession since five (5) years prior to the year of the manufacture of the trailer in question wherein a party alleged injuries sustained from a fall from a trailer upper deck or ladder in the [Jack Cooper] or Pacific Motor Trucking Company *** fleets.” Continental responded to request number 1 with the nonparty objection and added: “Moreover, Intervenor has hundreds of claim files since it has insured [Jack Cooper] and has no knowledge where the trailer in question was manufactured. Subject to such objection and without waiving that objection, Intervenor can produce a claim listing of all claims involving [Jack Cooper].” ¶ 13 Request number 13 sought “[c]opies of any medical records of the Plaintiff already received by you or your attorneys from any source other than from the Plaintiff[’s] attorneys.” Continental responded to request number 13 with the nonparty objection and added: “Subject to said objection, and without waiving same, Intervenor has no such documents other than Plaintiff Gregory Burdess’[s] workers’ compensation file materials for the subject incident previously produced herein. In addition, Intervenor is in possession of medical records for three additional workers’ compensation claims made by Plaintiff, Gregory Burdess. Those claim files are voluminous and will only be produced upon Plaintiffs’ specific request.” 5 ¶ 14 Request number 42 directed Continental to “[p]roduce a true copy of the printout of injury summaries from your computer database(s) for injuries to [Jack Cooper] drivers since you began insuring [Jack Cooper] for workers[’] compensation claims.” Continental responded to request number 42 with the nonparty objection and added: “Subject to said objection, without waiving same and in addition to Intervenor’s workers’ compensation file materials previously produced herein, Intervenor can produce a claim listing of all claims involving Jack Cooper Transport Company.” ¶ 15 On April 26, 2019, the plaintiffs filed a motion for sanctions, contending Continental’s responses to the discovery requests were insufficient. In its response to the motion for sanctions, Continental reiterated that it was not subject to the discovery requests due to its limited role as intervenor. Notwithstanding its continuing nonparty objection, Continental indicated that it had produced nearly 500 pages of documents related to Gregory’s workers’ compensation file. Continental further asserted that it had timely responded to the discovery requests on March 25, 2019, and contended that the plaintiffs’ motion for sanctions was improper because the plaintiffs made no effort to resolve the discovery dispute, pursuant to Illinois Supreme Court Rule 201(k) (eff. July 1, 2014), prior to filing the motion for sanctions. ¶ 16 In the alternative, Continental contended that its discovery responses complied with Rules 213 and 214. Continental indicated that it had produced all medical records and bills in its possession that were associated with Gregory’s workers’ compensation claim, identified witnesses with relevant knowledge, produced all records in support of its lien, produced all information in its possession pertaining to surveillance of Gregory, and identified all information in its possession regarding other claims involving Jack Cooper. Continental further contended that the identity of any alleged control group at Continental was irrelevant to the lawsuit. Finally, Continental alleged 6 that it had compiled a listing of all claims involving Jack Cooper and indicated that “[t]he gathering of this information was labor intensive and necessarily took time as it required a manual review of each of [Jack Cooper’s] hundreds of claim files.” ¶ 17 On May 14, 2019, a hearing was conducted on the plaintiffs’ motion for sanctions. There, the plaintiffs’ counsel complained that Continental had produced a list of workers’ compensation claims, containing over 3000 injury claims of nonparty employees of Jack Cooper. The plaintiffs’ counsel protested that Continental made no attempt to sort through the injury claims to determine which ones involved injuries similar to Gregory’s—falls from the upper decks of the Jack Cooper vehicle transportation rigs. The plaintiffs’ counsel alleged that what Continental produced was “not even close to being acceptable” and indicated that if Continental did not want to expend the effort to produce the injury records involving upper deck falls, counsel would sort through them himself. ¶ 18 Counsel for Continental responded that Continental had compiled a list of all claims involving Jack Cooper “to try and accommodate counsel.” He explained that “[i]t was an onerous undertaking. It was a manual undertaking going through hundreds of claims files, but we put it together for him.” Counsel for Continental asserted that “now that we have this list put together,” he could look into whether it would be possible to electronically search to determine which of the claims involved upper deck falls. ¶ 19 At the conclusion of the hearing, the circuit court entered an order overruling Continental’s objections, ordering Continental to pay the plaintiffs’ attorney fees related to the motion for sanctions, ordering Continental to fully answer the discovery within 30 days, and effective June 13, 2019, imposing sanctions on Continental in the amount of $150 for every day that it did not fully comply with the discovery requests. 7 ¶ 20 On June 13, 2019—the date the daily sanctions were to commence—Continental filed a motion for a finding of friendly contempt, pursuant to Illinois Supreme Court Rule 304(b)(5) (eff. Mar. 8, 2016), in which it requested the circuit court to impose a nominal penalty for Continental’s failure to comply with the discovery orders. Continental sought the finding of friendly contempt as an avenue to appeal the issue of whether an intervenor who intervenes in a lawsuit to protect its workers’ compensation lien is obligated to participate in discovery as a full party to the litigation. ¶ 21 On June 20, 2019, after a hearing, the circuit court entered an order granting Continental’s motion for a finding of friendly contempt, imposing a nominal penalty of $1 per day against Continental and ruling that the May 14, 2019, order imposing sanctions against Continental in the amount of $150 per day remained in effect. Continental filed a timely notice of appeal (First Appeal). ¶ 22 On September 26, 2019, while the First Appeal was pending, the plaintiffs issued to Continental a notice of discovery deposition pursuant to subpoena, to be conducted on October 30, 2019, in Madison County, Illinois. The subpoena ordered Continental to provide at the deposition the same information the plaintiffs had requested in their earlier request for production of documents, pursuant to Rule 214. The previous request for production was attached to the subpoena as Plaintiff’s Exhibit A. ¶ 23 On October 18, 2019, Continental filed a motion to quash subpoena. In the motion, Continental asserted that it is an Iowa corporation with its principal place of business in Omaha, Nebraska, and it transacted no business in Madison County or St. Clair County. Accordingly, Continental contended that the deposition should proceed in Omaha, Nebraska. Second, Continental alleged that the information requested in the subpoena was the subject of discovery orders pending in the First Appeal. Thus, Continental requested the circuit court to stay the 8 subpoena until after the disposal of the First Appeal. Third, Continental objected to the subpoena on the following bases: it sought workers’ compensation claim files for nonparties containing information protected by the Health Insurance Portability and Accountability Act of 1996 (HIPAA) ( 42 U.S.C. § 201 et seq.), it sought information that was irrelevant to Continental’s workers’ compensation lien or to the underlying litigation, the request was disproportionate because the burden and expense to produce the files outweighed any likely benefit, the information sought was subject to attorney/client privilege and insurer/insured privilege, and the information sought was protected from disclosure under the Illinois Insurance Code (215 ILCS 5/1 (West 2018)). Finally, Continental requested additional time to produce the discoverable records from Gregory’s prior workers’ compensation claims. For these reasons, Continental requested the circuit court to enter an order quashing the subpoena. Attached as Exhibit 2 to the motion to quash subpoena was an affidavit of Jeffrey Silver, secretary for Continental, dated October 15, 2019. Silver asserted in the affidavit, inter alia, that Continental would need until November 15, 2019, in which to identify, redact, and log all information that it considered to be privileged or otherwise nondiscoverable. ¶ 24 On November 25, 2019, the plaintiffs filed a response to Continental’s motion to quash subpoena in which they asserted, inter alia, that notwithstanding Silver’s affidavit which requested an extension to November 15, 2019, to date, no log had been supplied to the plaintiffs and no records had been produced. ¶ 25 On November 26, 2019, a hearing was held on the motion to quash subpoena. As reflected in a bystander’s report of this hearing, Continental argued all the points raised in its motion to quash subpoena, and the plaintiffs argued all the points raised in their response to the motion to quash. In addition, the plaintiffs contended that Continental should not be allowed to argue the 9 same objections and/or raise new objections via the motion to quash because the deadline to comply with the prior orders had lapsed. ¶ 26 Regarding the production of the claim files of the nonparty Jack Cooper employees, the plaintiffs asserted that they were not requesting medical records but only documents identifying the type of accident involved, electronic reports and/or summaries of the injuries, supervisors’ reports of injuries, and drivers’ reports of injuries. In response to Continental’s argument that the claim information for the nonparty employees was irrelevant, the plaintiffs indicated that they obtained by court order information from other insurance carriers that proved defendant AHC had not produced all information on claims similar to Gregory’s and the claim information from Continental was needed to determine whether AHC had other similar claims against it. ¶ 27 Regarding the burden associated with producing the nonparty employee records, the circuit court questioned Continental’s counsel regarding how much time and effort would be necessary to gather the information. Continental’s counsel placed a telephone call to obtain an answer, but the representative who could provide the information was unavailable. Accordingly, the circuit court continued the hearing to December 9, 2019, so counsel could gather the information necessary to establish the burden associated with producing the requested information. ¶ 28 The hearing reconvened on December 9, 2019. As reflected in a bystander’s report of the hearing, Continental referenced the supplemental affidavit of Silver, which was filed in the circuit court on December 5, 2019. In the supplemental affidavit, Silver indicated that none of the workers’ compensation claim files are electronically stored and are not searchable through any available computer system. On that basis, Silver set forth the time and effort that would be required to assemble, review, and extract information from approximately 3300 nonparty claim files. 10 ¶ 29 Silver averred in the supplemental affidavit that locating and assembling the claim files would take a full day and at the current wage rates of $16 to $17 per hour for the employees who would be assigned that task, the cost of locating and assembling the claim files would exceed $1500. Silver further averred that if specific information regarding the nature of the underlying accidents for the claim files sought were to be reviewed and summarized, the projected hours would consist of an additional 30 minutes per file, yielding an approximate cost of an additional $26,400 to $28,500. ¶ 30 Silver suggested in the supplemental affidavit that the plaintiffs’ counsel be allowed to review the files as an alternative to Continental extracting the information sought. He averred that Continental would still incur substantial costs in that instance because the claim files contained personal health information of nonparties for whom HIPAA authorizations had not been executed, and thus the personal health information would need to be redacted if the plaintiffs’ counsel were allowed to review the claim files. Moreover, Silver stated that if the plaintiffs’ counsel examined the files, entries protected from disclosure under the attorney-client privilege, work product doctrine, insurer-insured privilege, and section 2-1003(e) of the Code (735 ILCS 5/2-1003(e) (West 2018)) would need to be identified and redacted. Silver asserted in the supplemental affidavit that such a task would require 1.5 hours per file to review and redact the protected information, for a total of 4950 hours at a cost of $50 per hour for a skilled individual, totaling over $200,000. Accordingly, Silver indicated that producing the requested information would impose an undue hardship and burden on Continental. ¶ 31 The figures in the supplemental affidavit establishing the burden and cost referred directly to producing the workers’ compensation claim files. The supplemental affidavit references the effort necessary to identify “the nature of the underlying accident that resulted in the filing of the 11 listed workers’ compensation claims” but makes no direct reference to the burden and cost to produce the reports of injuries completed by supervisors and/or drivers employed by Jack Cooper involving falls from the trailers, as requested in paragraph 1 of the subpoena or the burden and cost to produce copies of all fleet injury reports filled out by drivers and/or supervisors involving falls from the upper decks as requested in paragraph 4 of the subpoena. The plaintiffs’ counsel alleged that the burden to produce the injury record data was minimal as such could be generated by a “simple keystroke on a computer.” Continental’s counsel responded that he was unsure if the injury records were contained or accessible on a computer. ¶ 32 Although the plaintiffs’ counsel produced no evidence rebutting Silver’s supplemental affidavit, counsel emphasized that the plaintiffs were not conceding its accuracy. The plaintiffs’ counsel again emphasized that the plaintiffs were not requesting medical information and asserted that if Continental maintained that the burden was too great, he would travel to the injury record location to sort through the records himself. Counsel argued in the alternative that he would pay the costs to ship the injury records so he could sort through the records with no burden to Continental. ¶ 33 At the conclusion of the hearing, the circuit court orally granted Continental’s motion to quash in part and denied it in part. Continental advised the circuit court that it would disobey its ruling on the denied portion of its motion to quash, requested to be held in contempt of court so the ruling could be appealed, and requested the contempt penalty to be set at $25. On December 17, 2019, the circuit court entered its written order granting in part and denying in part Continental’s motion to quash subpoena. The circuit court granted the motion to quash to the extent that it sought to conduct the deposition in Edwardsville, Illinois, and ordered that the deposition would proceed in Omaha, Nebraska. The motion to quash was further granted to the extent that 12 the plaintiffs requested Continental to produce all of Gregory’s workers’ compensation claim information. Accordingly, the circuit court ordered Continental to produce Gregory’s workers’ compensation claim with all privileged information redacted and delineated in a privilege log. ¶ 34 The circuit court denied the motion to quash to the extent that it sought to relieve Continental of the obligation to produce workers’ compensation claim forms and reports of injuries completed by supervisors and/or drivers and injury reports filled out by drivers and/or supervisors for injuries as requested in paragraphs 1 and 4 of the subpoena. The circuit court ordered Continental to make copies of the same available for inspection at the deposition. The circuit court found that the plaintiffs had not requested medical records or claim notes of nonparties. Accordingly, Continental was not required to produce those records nor any other requested documents that were identified by Continental in the privilege log. The circuit court ordered Continental to produce all other records within its possession, custody, and control as requested in the subpoena. ¶ 35 The circuit court observed Continental’s refusal to comply with the order to produce the information requested in paragraphs 1 and 4 of the subpoena. Accordingly, the circuit court held Continental in contempt of court and imposed a penalty of $25 for its noncompliance. Continental filed a timely notice of appeal (Second Appeal). On January 23, 2020, this court entered an order consolidating the First Appeal with the Second Appeal. ¶ 36 ANALYSIS ¶ 37 At the outset, we address a jurisdictional issue raised by the plaintiffs, who contend that if Continental were not a party to the underlying litigation, this court would have no jurisdiction over this appeal. Put another way, the plaintiffs claim that Continental could not raise the instant appeal but for its status as a party to the underlying litigation. We disagree. Illinois case law establishes 13 that nonparties have standing to appeal contempt orders against them. See Montes v. Mai, 398 Ill. App. 3d 424 , 426 (2010) (nonparty chiropractor had standing to appeal contempt order for his refusal to appear at deposition); Crnkovich v. Almeida, 261 Ill. App. 3d 997 , 999 (1994) (nonparty nurses and nonparty counsel for defendant hospital appealed contempt order against them for nurses’ refusal to answer questions at depositions per counsel’s instructions). We have jurisdiction over this appeal, regardless of whether Continental is a party or nonparty to the underlying litigation. Accordingly, we proceed with the merits of the appeal. ¶ 38 Continental raises the following two issues on appeal: (1) whether the circuit court erred by holding Continental in contempt of court and imposing a penalty for noncompliance with the discovery orders entered pursuant to the plaintiffs’ discovery requests under Illinois Supreme Court Rule 213 (eff. Jan. 1, 2018) and Rule 214 (eff. July 1, 2018), and (2) whether the circuit court erred by holding Continental in contempt of court and imposing a penalty for noncompliance with the order to produce the information requested in the plaintiffs’ discovery deposition subpoena. ¶ 39 I. Rule 213 and Rule 214 Discovery Requests ¶ 40 We first determine whether the circuit court erred by holding Continental in contempt of court and imposing a penalty for noncompliance with the discovery orders entered pursuant to the plaintiffs’ discovery requests under Illinois Supreme Court Rule 213 (eff. Jan. 1, 2018) and Rule 214 (eff. July 1, 2018). ¶ 41 “Because discovery orders are not final orders, they are not ordinarily appealable.” Reda v. Advocate Health Care, 199 Ill. 2d 47 , 54 (2002). “However, it is well settled that a contempt proceeding is an appropriate method for testing the correctness of a discovery order.” Id. “When an individual appeals from a contempt sanction imposed for violating *** a discovery order, the 14 contempt finding is final and appealable and presents to the reviewing court the propriety of that discovery order.” Id. “[W]here the trial court’s discovery order is invalid, a contempt judgment for failure to comply with the discovery order must be reversed.” In re Marriage of Bonneau, 294 Ill. App. 3d 720 , 723 (1998). ¶ 42 “Although a trial court’s discovery order is ordinarily reviewed for a manifest abuse of discretion [citation], the proper standard of review depends on the question that was answered in the trial court.” Norskog v. Pfiel, 197 Ill. 2d 60 , 70 (2001). “If the facts are uncontroverted and the issue is the trial court’s application of the law to the facts, a court of review may determine the correctness of the ruling independently of the trial court’s judgment.” Id. at 70-71 . In this case, integral to our review of the propriety of the discovery orders is a determination of whether Continental—which intervened in the underlying litigation for the sole purpose of asserting its workers’ compensation lien—should have been treated as a party to the litigation and made subject to the discovery mandates of Rules 213 and 214. This issue is a matter of law subject to de novo review. See id. at 71 . ¶ 43 Here, Continental argues that it is not, and never has been, a party to this case. Accordingly, Continental contends that it was not subject to the plaintiffs’ discovery requests under Rules 213 and 214 and the correlating discovery orders were invalid as a result. Conversely, the plaintiffs argue that by intervening, Continental became a party to the litigation and was bound to comply with the discovery requests under Rules 213 and 214. ¶ 44 Illinois Supreme Court Rule 213 (eff. Jan. 1, 2018) and Rule 214 (eff. July 1, 2018) govern discovery between parties. Rule 213(a) provides that “[a] party may direct written interrogatories to any other party.” Ill. S. Ct. R. 213(a) (eff. Jan. 1, 2018). Similarly, Rule 214(a) provides that “[a]ny party may by written request direct any other party to produce *** specified documents.” 15 Ill. S. Ct. R. 214(a) (eff. July 1, 2018). Rule 214(e) addresses the procedure for obtaining information from nonparties as follows: “This rule does not preclude an independent action against a person not a party for production of documents ***.” Ill. S. Ct. R. 214(e) (eff. July 1, 2018). Accordingly, the supreme court rules are used to procure information from parties only and independent measures must be taken to procure information from nonparties. See id. ¶ 45 Regarding intervention procedure, section 2-408(a)(1) of the Code provides, inter alia: “Upon timely application anyone shall be permitted as of right to intervene in an action: (1) when a statute confers an unconditional right to intervene ***.” 735 ILCS 5/2-408(a)(1) (West 2018). Pursuant to section 2-408(f) of the Code: “An intervenor shall have all the rights of an original party ***.” Id. § 2-408(f). Therefore, one who intervenes under this section of the Code—having all the rights of an original party—would be authorized to participate in discovery as a party and, as such, would be subject to the discovery mandates of Rules 213 and 214. See id. ¶ 46 Here, Continental brought its motion for leave to file a petition to intervene pursuant to section 2-408 of the Code (id. § 2-408) and cited section 5(b) of the Act as authority to intervene for purposes of protecting and securing its lien (820 ILCS 305/5(b) (West 2018)). The plaintiffs argue that section 5(b) of the Act created no more than the statutory unconditional right for Continental to intervene as referenced in section 2-408(a)(1) of the Code, but once the intervention was established, it was governed by section 2-408 of the Code. We disagree. ¶ 47 In Madison Two Associates v. Pappas, 227 Ill. 2d 474 , 494 (2008), the Illinois Supreme Court observed section 1-108(b) of the Code, which “expressly provides that where proceedings are governed by some other statute, the other statute controls to the extent it regulates procedure, but that *** the Code *** applies to matters of procedure not regulated by the other statute.” The Pappas court noted that the Property Tax Code (35 ILCS 200/1-1 et seq. (West 2002)) at issue in 16 that case did not include a particular provision addressed to intervention in the circuit court. Id. Accordingly, the court held that the matter was to be governed by the intervention provisions of article II of the Code. Id. at 494-95 ; see also In re Petition for Annexation of Unincorporated Territory to the Village of Palatine, 234 Ill. App. 3d 927 , 929-30 (1992) (where intervention is based on specific statute, courts look to that statute, not section 2-408 of the Code, for conditions limiting the intervention). ¶ 48 In this case, Continental intervened to protect its lien as authorized by the Act, which includes provisions regarding intervention in the circuit court. Section 5(b) provides that if the injured employee receives compensation from the employer, the employer may claim a lien on any judgment out of which the employee may be compensated from a third-party action. 820 ILCS 305/5(b) (West 2018). Section 5(b) further provides that “[t]he employer may, at any time thereafter join in the action upon his motion so that all orders of court after hearing and judgment shall be made for his protection.” Id. Contrary to the plaintiffs’ argument, because the Act contains provisions addressed to intervention in the circuit court, Continental’s intervention is governed by the Act rather than article II of the Code. See Pappas, 227 Ill. 2d at 494-95 ; Palatine, 234 Ill. App. 3d at 929-30. ¶ 49 In addition to the stated statutes and supreme court rules, Illinois case law also establishes that intervenors under section 5(b) of the Act are limited in their role and are forbidden from participating as parties and being subject to discovery in the underlying suit. In Sjoberg v. Joseph T. Ryerson & Son, Inc., 8 Ill. App. 2d 414 , 417 (1956), the court held that the sole purpose of allowing an employer to intervene in a lawsuit is for the employer to protect its workers’ compensation lien. The Sjoberg court elaborated that “such intervention shall not extend to the intervening petitioner the right to participate in the conduct or trial of the suit, without the consent 17 of [the] plaintiff.” Id. at 418; see also Pederson v. Mi-Jack Products, Inc., 389 Ill. App. 3d 33 , 40 (2009) (absent consent of employee, employer’s intervention is limited to ensuring that court protects its lien). ¶ 50 We observe that Sjoberg involved an intervenor that desired to participate in the trial and was forbidden from doing so without the plaintiff’s consent (8 Ill. App. 2d at 417), and the instant case involves Continental, an intervenor which did not desire to participate in the trial beyond the limited purpose of protecting its lien, and the plaintiffs obtained discovery orders requiring Continental to further participate against its will. Nevertheless, section 5 of the Act limits intervenors in their roles and does not provide for automatic participation as parties in the underlying litigation. See id. ¶ 51 The plaintiffs contend that Sjoberg established that it is a plaintiff’s choice whether to limit the role of an employer who chooses to intervene. We disagree and conclude that Sjoberg held that a plaintiff may limit the role of an employer who intervenes and desires to participate in the trial. See id. Such is not the case here. The plaintiffs cite no authority establishing that a circuit court has the power to mandate an intervenor under section 5(b) of the Act to participate as a party to the litigation against its will or to subject it to the discovery requirements incumbent on parties under Rules 213 and 214. ¶ 52 Also notable is Jackson v. Polar-Mohr, 115 Ill. App. 3d 571 , 574 (1983), in which the court held that under the Act “an employer may intervene in an employee’s cause of action at any stage prior to the satisfaction of judgment.” The court continued: “Since the employer’s interest in the judgment is in the form of a lien [citations], his intervention is limited to protecting the lien in all orders of the court after hearing and judgment [citation].” Id. Applying these principles, if an intervention pursuant to the Act may occur any time before the satisfaction of judgment, it follows 18 that the intervention may very well occur after the litigation has concluded and after the judgment has been entered, so long as it precedes the satisfaction of the judgment. If the intervention occurred after the judgment was entered, the intervenor could not be a party to the litigation nor participate in discovery, thus confirming that an intervenor was not intended to be a party under the Act. ¶ 53 Taken a step further, “[a]n employer is not required to bring an action to protect its lien.” Hunt v. Herrod, 2019 IL App (3d) 170808 , ¶ 15. “Employers are provided a right under section 5(b) to recover amounts paid for workers’ compensation where the employee settles with the third- party tortfeasor, ‘regardless of whether a lien has been asserted.’ ” Id. (quoting Scott v. Industrial Comm’n, 184 Ill. 2d 202 , 216 (1998)). Indeed, section 5(b) of the Act indicates that “[t]he employer may, at any time thereafter join in the action upon his motion so that all orders of court after hearing and judgment shall be made for his protection.” (Emphasis added.) 820 ILCS 305/5(b) (West 2018). The fact that an employer is entitled to recover without intervening only further demonstrates that the employer was not intended to be a party under the Act. If an employer were intended to be a party, intervening would be a requirement, not an option, and there would be no language in the Act limiting the intervention to asserting and protecting the lien. ¶ 54 We further observe that in Jackson, when the circuit court granted leave to file a petition to intervene pursuant to the Act, it ordered the intervenor not to participate in the trial (115 Ill. App. 3d at 572-73) and the reviewing court subsequently identified the intervenor as a nonparty (id. at 576). See also Sheppard v. Rebidas, 354 Ill. App. 3d 330 , 334-35 (2004) (court obligated to protect interests of nonparty employer who intervenes to protect its lien because the nonparty employer cannot protect itself in settlements between employee and third party); Brandt v. John S. Tilley Ladders Co., 145 Ill. App. 3d 304 , 308 (1986) (court disagreed that intervenor was 19 attempting to participate in discovery, as intervenor’s interest was to have trial conducted on the merits and not dismissed at pretrial stage, consistent with protecting its lien); Mistler v. Mancini, 111 Ill. App. 3d 228 , 231 (1982) (parties to litigation discover relevant information from third persons via subpoena). ¶ 55 Besides the foregoing principles, a contempt order also merits reversal “where the refusal to comply with the court’s order constitutes a good-faith effort to secure an interpretation of an issue without direct precedent.” In re Marriage of Radzik, 2011 IL App (2d) 100374 , ¶ 67; see also Doe v. Township High School District 211, 2015 IL App (1st) 140857 , ¶ 124 (civil contempt should not stand when noncompliance with discovery order is based on good faith effort to clarify an issue). That is what occurred in this case. ¶ 56 We acknowledge the plaintiffs’ citation to Willeford v. Toys “R” Us-Delaware, Inc., 385 Ill. App. 3d 265 (2008), in support of its allegation that Continental’s motion for friendly contempt was not in good faith. We distinguish Willeford, however, because there the defendants’ refusal to comply with the discovery order was not a good faith effort to secure an interpretation of an issue without precedent. See Radzik, 2011 IL App (2d) 100374 , ¶ 67. Rather, the defendants in Willeford filed a motion for a protective order one year after their discovery responses were due and then subsequently filed a motion to reconsider the discovery order and did not file their motion for friendly contempt until over eight months later when they responded to the plaintiff’s motion for sanctions. 385 Ill. App. 3d at 277. Observing that the discovery dispute had exceeded five years, the Willeford court concluded that the defendants did not act in good faith in challenging the discovery order through a motion for friendly contempt and refused to vacate the contempt order for that reason. Id. 20 ¶ 57 Conversely, here, the record reflects that Continental’s purpose in filing its motion for friendly contempt was not to cause undue delay or to dishonor the court, as was the case in Willeford, but rather to seek an appeal for a determination of an issue with no direct precedent (see Radzik, 2011 IL App (2d) 100374 , ¶ 67), namely whether an intervenor under section 5(b) of the Act is considered a party in the underlying litigation and therefore subject to supreme court discovery rules. At the June 20, 2019, hearing on Continental’s motion for friendly contempt, counsel for Continental indicated that “case law supports the notion that the role of the intervenor is limited” and an intervenor is “not required to participate in [full] discovery, but there’s not been a clear pronouncement on that point by any Illinois [a]ppellate district.” Counsel continued, “This is an opportunity, in our mind, for that *** pronouncement to be made.” ¶ 58 This case is further distinguished from Willeford because, here, eight months passed from the time the plaintiffs issued their discovery requests until Continental filed its motion for friendly contempt, much less time than the five years in Willeford. See 385 Ill. App. 3d at 277. There is no evidence of any bad faith attributable to Continental in objecting as it did and filing its motion for friendly contempt for the said purpose of resolving an unprecedented issue on appeal. For these reasons, we find Continental exercised good faith in challenging the discovery orders by filing the motion for friendly contempt, and we conclude that the contempt order merits reversal on this additional basis. See Radzik, 2011 IL App (2d) 100374 , ¶ 67. ¶ 59 The plaintiffs contend that “[i]t is clear from the record” that the circuit court “imposed sanctions for failure to comply with its order long before Continental sought a finding of [friendly] contempt.” We disagree. Although the circuit court entered its order imposing sanctions on May 14, 2019, the sanctions were not ordered to commence until June 13, 2019, the same date Continental filed its motion for friendly contempt. Thus, the plaintiffs’ argument is unfounded. As 21 noted, the discovery orders were improper, resulting in the sanctions for Continental’s failure to comply with the discovery orders also being improper. ¶ 60 For the foregoing reasons, we conclude that Continental did not become a party to the underlying litigation by intervening to protect its lien under section 5(b) of the Act. Because Continental was not a party to the underlying litigation, it was not subject to the discovery mandates of Rules 213 and 214. As a result, the circuit court’s discovery orders entered March 11, 2019, and May 14, 2019, were improper, as were the sanctions imposed in the latter order, and we reverse those orders. Because we conclude that the discovery orders were improper, we reverse the June 20, 2019, order holding Continental in contempt of court for violating the discovery orders. ¶ 61 We acknowledge the parties’ additional opposing arguments regarding the timing of Continental’s relevance, burden, and privacy objections. However, the nonparty objection raised by Continental was the threshold issue to address because if Continental was not bound as a party under Rules 213 and 214, it was not bound to the response or objection requirements of those rules. Having concluded that Continental—as intervenor under the Act—was not a party to the litigation and was not subject to the discovery requirements of Rules 213 and 214, we need not address the remaining arguments pertaining to objections beyond the nonparty objection. ¶ 62 II. Discovery Deposition Subpoena ¶ 63 The final issue on appeal is whether the circuit court erred by holding Continental in contempt of court and imposing a penalty for noncompliance with its order to produce the information requested in the plaintiffs’ discovery deposition subpoena. Again, “where the trial court’s discovery order is invalid, a contempt judgment for failure to comply with the discovery order must be reversed.” Bonneau, 294 Ill. App. 3d at 723. “The trial court has broad discretion in 22 ruling on discovery matters, and its orders concerning discovery will not be interfered with on appeal absent a manifest abuse of such discretion.” Mistler, 111 Ill. App. 3d at 233. ¶ 64 Continental advances a twofold argument regarding this issue. First, Continental contends that the circuit court erred by holding it in contempt of court because the requested nonparty workers’ compensation claim forms and injury reports were not relevant to any issue in the case. In the alternative, Continental argues that even if the requested information is relevant, the circuit court erred by holding it in contempt of court because the burden of collecting, reviewing, and producing the requested nonparty workers’ compensation claim forms and injury reports outweighs any benefit that might be realized by their production. ¶ 65 Before proceeding with these arguments, we observe the plaintiffs’ challenges regarding the timeliness of Continental’s relevance and undue burden objections. The plaintiffs complain that Continental raised these objections only after the subpoena was issued and contend that they “should have been raised nearly a year earlier, to avoid undue delay.” We disagree. As stated in our review of the first issue, Continental’s nonparty objection encompassed a threshold issue needing resolution before Continental would be required to raise any additional objections. Because we found that Continental did not become a party by intervening and was therefore not subject to the mandates of Rules 213 and 214, it was neither required to make any further objections under those rules nor was it bound by the timeliness requirements thereof. As noted, because Continental was a nonparty, the discovery deposition subpoena was the proper mode for the plaintiffs to request information from Continental. The subpoena was issued to Continental on September 26, 2019. Continental asserted its objections regarding relevance, burden, and privacy in its motion to quash subpoena, which was timely filed in the circuit court on October 18, 2019. For these reasons, we reject the plaintiffs’ argument that Continental’s objections were untimely. 23 ¶ 66 A. Relevance ¶ 67 Having established that Continental was not a party for purposes of Illinois Supreme Court Rules 213 and 214, we note that “the rules also provide a party the means to discover relevant matter from third persons through the use of subpoenas.” Id. at 231. “Discovery before trial presupposes a range of relevance and materiality which includes not only what is admissible at trial but also that which leads to what is admissible at trial.” Id. at 232. “Thus, great latitude is allowed in the scope of discovery.” Id. ¶ 68 However, “[i]n the context of civil discovery, reasonableness is a function of relevance.” Kunkel v. Walton, 179 Ill. 2d 519 , 538 (1997). “The supreme court rules governing civil discovery advance this principle by limiting discovery to information that is relevant to the issues in the lawsuit.” Carlson v. Jerousek, 2016 IL App (2d) 151248 , ¶ 37; see also Manns v. Briell, 349 Ill. App. 3d 358 , 361 (2004) (threshold requirement of relevance to matters at issue must be met before circuit court may order discovery of information). “Although relevant (discoverable) information is defined broadly to encompass not only admissible information but also information calculated to lead to the discovery of admissible information [citation], this definition is not intended as an invitation to invent attenuated chains of possible relevancy.” Carlson, 2016 IL App (2d) 151248 , ¶ 37. ¶ 69 Moreover, “[t]he corollary to the relevance requirement is that the compelled disclosure of highly personal information ‘having no bearing on the issues in the lawsuit’ is an unconstitutional invasion of privacy.” Id. (quoting Kunkel, 179 Ill. 2d at 539 ). “The constitutional right embodied in the privacy clause of the Illinois Constitution arose from the desire to safeguard against the collection and exploitation of intimate personal information.” Id. ¶ 34; see also Kunkel, 179 Ill. 2d at 538-39 (broad sweep disclosing confidential information unrelated to litigation is 24 unconstitutional and unreasonable); People v. Lurie, 39 Ill. 2d 331 , 335 (1968) (unreasonably broad subpoena seeking irrelevant material is unconstitutional); People v. Caballes, 221 Ill. 2d 282 , 330-31 (2006) (privacy clause intended to protect violation of personal privacy). ¶ 70 Here, Continental argues that the subpoena impermissibly sought discovery beyond what was relevant. Continental contends that although the plaintiffs did not request medical records, they sought information regarding injuries sustained by nonparty employees of Jack Cooper, which Continental alleges has no bearing on the issues in the lawsuit and is no less private than medical records. ¶ 71 The plaintiffs respond that the requested information is relevant because it pertains to allegations the plaintiffs made against AHC, the wholly owned subsidiary of Jack Cooper, which is insured by Continental. The plaintiffs indicate that AHC and Jack Cooper share the same officers and directors and the complaint in the underlying litigation alleges that AHC was negligent in light of what it knew or should have known about the dangers associated with the upper decks of Jack Cooper’s trailers. The plaintiffs emphasize that they obtained information from other insurance carriers that proved that AHC had not produced all information on claims similar to Gregory’s and the claim information from Continental was needed to determine whether AHC had other similar claims against it. ¶ 72 The plaintiffs further argue that the information Jack Cooper provided to Continental regarding injuries to its drivers arising from falls from the upper decks of its trailers is discoverable because it is relevant to the claim in the underlying lawsuit that the upper deck of the trailer was dangerous because AHC failed to install fall protection upgrades that Cottrell had made available to AHC. The plaintiffs add that the information is relevant to the claim in the underlying lawsuit 25 that AHC had notice of the dangers associated with the upper decks yet failed to provide warnings to Gregory and failed to take steps to mitigate or eliminate the danger. We agree with the plaintiffs. ¶ 73 It is well established in Illinois that evidence of prior accidents is relevant to show notice and/or dangerousness of a condition, even if the prior accident is dissimilar to the present accident. See Trimble v. Olympic Tavern, Inc., 239 Ill. App. 3d 393 , 397 (1993) (proponent need not show similarity between accidents if the evidence of prior accident is offered to show defendant’s notice of the hazardous nature of the accident site); Turgeon v. Commonwealth Edison Co., 258 Ill. App. 3d 234 , 239 (1994) (evidence of prior accidents admissible to show existence of danger or to show defendant’s notice of hazardous nature of accident site); Mikus v. Norfolk & Western Ry. Co., 312 Ill. App. 3d 11 , 22-23 (2000) (same). ¶ 74 Here, we agree with the plaintiffs that the workers’ compensation claim forms and reports of injuries completed by supervisors and/or drivers and injury reports filled out by drivers and/or supervisors for injuries as requested in the subpoena are relevant for the stated reasons, and we disagree with Continental’s argument that the request exceeded the scope of relevance due to privacy concerns. The plaintiffs repeatedly emphasized that they were not requesting medical records. The circuit court observed the same in its order and specified that Continental need not produce any medical records or any other information redacted and identified in the privilege log. For these reasons, we find that the information the plaintiffs requested in the subpoena and ordered by the circuit court to be produced was relevant. ¶ 75 B. Proportionality ¶ 76 In the alternative, Continental argues that even if the information sought in the subpoena is relevant, the circuit court erred by holding Continental in contempt of court because the burden of collecting, reviewing, and producing the requested nonparty claim forms and injury reports 26 outweighs any benefit that might be realized by their production. “Proportionality imposes a second limitation on what is discoverable: even if it is relevant, information need not be produced if the benefits of producing it do not outweigh the burdens.” Carlson, 2016 IL App (2d) 151248 , ¶ 39. “ ‘[D]iscovery requests that are disproportionate in terms of burden or expense should be avoided.’ ” Id. ¶ 27 (quoting Ill. S. Ct. R. 201(a) (eff. July 1, 2014)). ¶ 77 Illinois Supreme Court Rule 201(c) (eff. July 1, 2014) “aims to prevent discovery abuse” and “contains several provisions for limiting discovery.” Carlson, 2016 IL App (2d) 151248 , ¶ 30. One such provision addresses proportionality as follows: “When making an order under this Section, the court may determine whether the likely burden or expense of the proposed discovery, including electronically stored information, outweighs the likely benefit, taking into account the amount in controversy, the resources of the parties, the importance of the issues in the litigation, and the importance of the requested discovery in resolving the issues.” Ill. S. Ct. R. 201(c)(3) (eff. July 1, 2014). ¶ 78 “The protections of Rule 201(c) apply to discovery directed to parties and nonparties alike.” Carlson, 2016 IL App (2d) 151248 , ¶ 30. “The proportionality balancing test requires a court to consider both monetary and nonmonetary factors in determining” whether the anticipated burden of the proposed discovery outweighs the anticipated benefit. Id. ¶ 40. Moreover, in determining whether discovery is unduly burdensome, courts should consider additional factors such as “whether the discovery is sought from a nonparty without any direct stake in the outcome of the litigation.” Id. ¶ 41. ¶ 79 1. Workers’ Compensation Claims ¶ 80 Here, the circuit court continued the hearing on the motion to quash subpoena so Continental could gather information regarding the burden of producing the requested information 27 and report the same to the circuit court so the balancing test could be conducted. The record reflects that the supplemental affidavit of Jeffrey Silver was filed in the circuit court on December 5, 2019, and presented when the hearing reconvened on December 9, 2019. As noted, the supplemental affidavit provides information regarding the burden to produce the workers’ compensation claim forms requested in paragraph 1 of the subpoena but does not directly reference any injury reports as requested in paragraphs 1 and 4 or the level of burden associated with their production. This was further exemplified by Continental’s counsel’s statement at the hearing that he was uncertain whether the injury records were stored on a computer. ¶ 81 The supplemental affidavit revealed that to produce copies of the workers’ compensation claims requested in paragraph 1, it would be necessary to manually review approximately 3300 nonparty claim files to determine which ones involved falls from the upper decks, then redact the privileged information from each relevant file before submitting the information to the plaintiffs. The supplemental affidavit reflected a bottom-line figure exceeding $200,000 for Continental to compete this task. The plaintiffs asserted that they did not concede the accuracy of the affidavit, but they offered no evidence in rebuttal. ¶ 82 The sum exceeding $200,000 to produce the workers’ compensation claims as requested in paragraph 1 of the subpoena is substantial and disproportionate to Continental’s lien amount of $128,897.79. 3 See Ill. S. Ct. R. 201(a) (eff. July 1, 2014) (discovery requests that are disproportionate in burden or expense should be avoided). In determining the breadth of the burden, besides the monetary amount to produce the information, we also consider that Continental 3 This figure is reflected in an e-mail dated January 9, 2019, from Continental’s counsel to the plaintiffs’ counsel that is attached as an exhibit to the plaintiffs’ January 29, 2019, motion to compel discovery and for sanctions. 28 is not a party to the underlying litigation with no direct stake in the outcome. See Carlson, 2016 IL App (2d) 151248 , ¶ 41. ¶ 83 Moreover, in examining any potential benefit to the production of the workers’ compensation claims as requested in paragraph 1 of the subpoena, we reiterate that while discoverable information has a broad definition, “this definition is not intended as an invitation to invent attenuated chains of possible relevancy.” Id. ¶ 37. The plaintiffs’ counsel indicated that he obtained by court order information from other insurance carriers that proved defendant AHC had not produced all information on claims similar to Gregory’s and the claim information from Continental was needed to determine whether AHC had other similar claims against it. Although we concluded that this requested information was relevant, we agree with Continental that the probative value of possibly discovering additional claims is minimal in comparison to the aforementioned burden for Continental to produce the information. As noted in Carlson, “[a] party may not ‘dredge an ocean of *** information and records in an effort to capture a few elusive, perhaps non-existent, fish.’ ” Id. ¶ 65 (quoting Tucker v. American International Group, Inc., 281 F.R.D. 85 , 95 (D. Conn. 2012)). ¶ 84 Although Carlson involved electronically stored information and the supplemental affidavit in this case reflects that the workers’ compensation claims are not stored electronically, the same logic applies in that the plaintiffs are not permitted to transmute their subpoena requests into a fishing expedition, especially in light of the unrebutted evidence of the burden associated with accommodating the request and considering Continental’s nonparty status. See Ill. S. Ct. R. 201(a) (eff. July 1, 2014); Carlson, 2016 IL App (2d) 151248 , ¶ 41. Because the evidence established that the burden of producing the workers’ compensation claims as requested in 29 paragraph 1 of the subpoena outweighs any benefit that may be realized from their production, we find the circuit court abused its discretion in ordering Continental to produce them. ¶ 85 2. Injury Reports ¶ 86 Besides the workers’ compensation claims requested in paragraph 1 of the subpoena, as noted, the supplemental affidavit mentions “reviewing and culling information identifying the nature of the underlying accident that resulted in the filing of the listed workers’ compensation claims” but makes no direct reference to the burden associated with producing the injury reports requested in paragraphs 1 and 4. Notwithstanding the lack of evidence regarding the injury reports, the plaintiffs’ counsel alleged at the hearing that the burden to produce the injury record data was minimal, as it could be generated by a “simple keystroke on a computer.” Although Continental asserts on appeal that it would be an undue burden to produce the injury reports and contends that the “uncontradicted evidence before the trial court is that the records are not electronically stored or searchable through a computer system,” Continental’s counsel indicated at the hearing on the motion to quash subpoena that he was uncertain whether the injury records were stored on a computer. Clearly counsel was not talking about the workers’ compensation claims themselves, as the subpoena reflects that those were not electronically stored. The statement by Continental’s counsel demonstrates that questions remained regarding the burden associated with producing the injury reports requested in paragraphs 1 and 4. ¶ 87 We observe that the plaintiffs’ counsel offered to travel to the injury record location to sort through the records himself or to pay the cost to ship the records so he could review them with no burden on Continental. However, this contradicts counsel’s own statement that the burden to produce the injury record data was minimal as such could be generated by a “simple keystroke on a computer.” If that were true, there would be no justification for counsel to take it upon himself 30 to review the records, as there would be no burden for Continental to produce the information at the deposition. However, as noted, no evidence was offered either way regarding the burden for Continental to produce the injury reports. ¶ 88 The circuit court was bound to conduct the balancing test required by the proportionality rule before ordering Continental to produce the injury reports as requested in paragraphs 1 and 4 (see Ill. S. Ct. R. 201(c)(3) (eff. July 1, 2014); Carlson, 2016 IL App (2d) 151248 , ¶ 69), but it failed to do so. To reiterate, at the hearing, the plaintiffs’ counsel claimed that there would be no burden for Continental to produce the information because it was computerized, and Continental’s counsel responded that he was uncertain if the injury records were accessible on a computer. Notwithstanding this uncertainty, the circuit court ordered Continental to produce the injury reports without first gathering evidence and conducting a balancing test to determine the associated burden. This was an abuse of discretion. See Carlson, 2016 IL App (2d) 151248 , ¶ 69 (failure to apply balancing test required by proportionality rule is error of law and abuse of discretion). ¶ 89 Having concluded that the circuit court abused its discretion by ordering Continental to produce the workers’ compensation claims requested in paragraph 1 of the subpoena because the evidence established the burden to produce them was disproportionate to the benefit anticipated by their production and abused its discretion by ordering Continental to produce the injury reports requested in paragraphs 1 and 4 of the subpoena without first conducting the balancing test as required by the proportionality rule, we reverse the December 17, 2019, order holding Continental in contempt of court for refusing to comply with the orders to produce the same. We remand for further proceedings to allow the circuit court to reconsider its ruling under the correct standard required by the proportionality rule regarding the injury reports requested in paragraphs 1 and 4. See id. ¶ 70. 31 ¶ 90 C. Final Considerations ¶ 91 On a final note, we observe the plaintiffs’ challenge of the accuracy of Silver’s supplemental affidavit regarding the cost to produce the requested information. They allege that the projected expense is inaccurate because Continental has already expended the effort to produce the information. We disagree. Silver’s first affidavit dated October 15, 2019, and attached as Exhibit 2 to Continental’s motion to quash subpoena indicates that Continental would need until November 15, 2019, in which to identify, redact, and log all information that it considered to be privileged or otherwise nondiscoverable. This was not accomplished, as the plaintiffs asserted in their response to the motion to quash that, to date, Continental had neither supplied a log nor produced any records, notwithstanding the self-imposed deadline of November 15, 2019. Hence, contrary to the plaintiffs’ claim, the labor had not been expended as of that date. ¶ 92 The plaintiffs nonetheless allege on appeal that “Continental has repeatedly suggested to the trial court that it has already done the work.” To that regard, the plaintiffs allege in their brief that Continental represented in its response to the plaintiffs’ April 26, 2019, motion for sanctions that “it had produced records referring to other similar injuries.” (Emphasis in original.) This claim is inaccurate, as the record shows that Continental actually indicated in its response to the motion for sanctions that it had compiled—not records referring to other similar injuries as alleged by the plaintiffs—but “a claim listing of all claims involving Jack Cooper” and explained that “[t]he gathering of this information was labor intensive and necessarily took time as it required a manual review of each of [Jack Cooper’s] hundreds of claim files.” Likewise, at the hearing on the motion for sanctions, Continental’s counsel stated that they compiled a list of all claims involving Jack Cooper “to try and accommodate counsel” and elaborated that “[i]t was an onerous undertaking. It was a manual undertaking going through hundreds of claims files, but we put it together for 32 him.” Based on these statements, the plaintiffs insinuate on appeal that Continental already expended the energy to produce what was requested. We disagree. ¶ 93 At the hearing on the motion for sanctions, the plaintiffs’ counsel complained that what Continental actually produced was a list of workers’ compensation claims containing over 3000 injury claims of nonparty employees of Jack Cooper. The plaintiffs’ counsel further protested that Continental made no attempt to produce what was requested by sorting through the injury claims to determine which ones involved injuries similar to Gregory’s—falls from the upper decks of the Jack Cooper vehicle transportation rigs. Counsel further objected that what Continental produced was “not even close to being acceptable.” Moreover, had Continental already produced what the plaintiffs requested as of the date of the hearing on the motion for sanctions, there would have been no need for the plaintiffs to have subsequently requested the information via subpoena. ¶ 94 Besides their protests at the hearing on their motion for sanctions, the plaintiffs emphasized in their briefing of the first issue on appeal that when Continental provided a list of all claims made by the employees of Jack Cooper, “that is not what Plaintiffs requested.” The plaintiffs indicated in their brief that they “requested copies of any claims or reports of injuries ‘wherein a party alleged injuries sustained from a fall from a trailer upper deck’ ” and that “Continental’s response, to furnish a list of all claims, without any indication whether those claims pertained to falls from the upper deck or ladder, did not provide what was sought in the request.” ¶ 95 The plaintiffs may not have it both ways. They may not complain on one hand in their briefing of the first issue that Continental did not produce what they requested, then suggest in their briefing of the second issue that the effort Continental expended to produce that wrong information somehow alleviates the burden associated with producing the information that they actually requested. As established, Silver’s supplemental affidavit sets forth the burden to produce 33 the information requested in paragraph 1 of the subpoena. We concluded that burden was substantial and disproportionate to any benefit that may be realized from the production of the information. For these reasons, we reject the plaintiffs’ arguments that Continental “has already done the work.” ¶ 96 CONCLUSION ¶ 97 For the foregoing reasons, we reverse the June 20, 2019, contempt order and reverse the March 11, 2019, and May 14, 2019, discovery orders upon which the contempt order was based; we reverse the portions of the December 17, 2019, order that denied Continental’s motion to quash and required Continental to produce the workers’ compensation claim forms and reports of injuries completed by supervisors and/or drivers and injury reports completed by drivers and/or supervisors for injuries as requested in paragraphs 1 and 4 of the subpoena; we reverse the portion of the December 17, 2019, order holding Continental in contempt of court for failing to produce the discovery ordered in the denied portions of the motion to quash; we affirm the portions of the December 17, 2019, order granting Continental’s motion to quash; and we remand for further proceedings to allow the circuit court to apply the correct legal standard, utilizing the balancing test required by the proportionality rule with regard to the injury reports requested in paragraphs 1 and 4 of the subpoena. ¶ 98 Affirmed in part and reversed in part; cause remanded. 34  No. 5-19-0279 Cite as: Burdess v. Cottrell, Inc., 2020 IL App (5th) 190279 Decision Under Review: Appeal from the Circuit Court of St. Clair County, No. 16-L- 189; the Hon. Christopher T. Kolker, Judge, presiding. Attorneys Jeffrey E. Kehl and Storrs W. Downey, of Bryce Downey & for Lenkov LLC, of Chicago, for intervenor-appellant. Appellant: Attorneys Roy C. Dripps, Charles W. Armbruster III, and Michael T. for Blotevogel, of Armbruster, Dripps, Winterscheidt & Blotevogel, Appellee: LLC, of Maryville, and Brian M. Wendler, of Wendler Law, P.C., of Edwardsville, for appellees. 35

2021-03-18 21:03:08.01876+00

http://courts.delaware.gov/Opinions/Download.aspx?id=318020

IN THE SUPREME COURT OF THE STATE OF DELAWARE NATIONAL UNION FIRE § INSURANCE COMPANY OF § PITTSBURGH, PA, U.S. § SPECIALTY INSURANCE § COMPANY, TWIN CITY FIRE § INSURANCE COMPANY, ALLIED § No. 68, 2021 WORLD NATIONAL ASSURANCE § COMPANY, TRAVELERS § Court Below–Superior Court CASUALTY AND SURETY § of the State of Delaware COMPANY OF AMERICA, STARR § INDEMNITY & LIABILITY § C.A. No. 18C-09-210 (CCLD) COMPANY, § § Defendants Below, § Appellant, § § v. § § NORTHROP GRUMMAN § INNOVATION SYSTEMS, INC., § § Plaintiff Below, § Appellee. § Submitted: March 3, 2021 Decided: March 18, 2021 Before VALIHURA, VAUGHN, and TRAYNOR, Justices. ORDER After careful consideration of the notice of interlocutory appeal and its exhibits, it appears to the Court that: (1) The appellee, Northrop Grumman Innovation Systems, Inc. (“Northrop”) brought suit in the Superior Court against its insurance companies seeking defense and indemnity insurance coverage for losses incurred by Northrop in connection with a class action lawsuit challenging proxy solicitation statements (“the 14(a) Claim”) about the merger of Alliant Techsystems, Inc. (“Alliant”) and Orbital Sciences Corporation and post-closing financial reports (“the 10(b) Claim”) about the value of the resulting entity—later acquired by Northrop—Orbital ATK, Inc. Northrop’s complaint identifies three separate towers of insurance coverage. Relevant here, Northrop seeks coverage under primary and excess directors’ and officers’ liability policies issued to Alliant (“the Alliant Policies”) by National Union Fire Insurance Company of Pittsburgh, PA, U.S. Specialty Insurance Company, Twin City Fire Insurance Company, Allied World National Assurance Company, Travelers Casualty and Surety Company of America, and Starr Indemnity & Liability Company (together, “the Alliant Insurers”). The Alliant Policies contain a carve-out provision (“the Bump-Up Provision”) that excludes from the policies’ definition of “loss” certain types of loss incurred from lawsuits alleging violations of federal securities law. Northrop moved for summary judgment against the Alliant Insurers arguing that coverage for the 14(a) Claim was not barred by the Bump-Up Provision. The Alliant Insurers cross-moved for summary judgment and asked the Superior Court to hold, as a matter of law, that coverage is unavailable for the 14(a) Claim, the 10(b) Claim, and certain defense costs. (2) On February 2, 2021, the Superior Court issued an opinion granting 2 Northrop’s motion for summary judgment as well as denying in part and granting in part the Alliant Insurers’ motion for summary judgment (“the Opinion).1 In relevant part,2 the Superior Court held that the Alliant Policies covered the 14(a) Claim3 and that certain expenses were covered “defense costs” under the Alliant Policies.4 (3) On February 12, 2021, the Alliant Insurers asked the Superior Court to certify an interlocutory appeal from the Opinion under Supreme Court Rule 42. The Alliant Insurers maintained that the Opinion determined a substantial issue—among other things, the Opinion determined that the Bump-Up Provision did not preclude indemnity coverage for the 14(a) Claim. The Alliant Insurers also argued that the following Rule 42 factors weighed in favor of interlocutory review: (i) the Opinion involves a question of law resolved for the first time in Delaware;5 (ii) interlocutory review could terminate the litigation as to the Alliant Insurers;6 and (iii) interlocutory review would serve considerations of justice.7 (4) The Superior Court denied the application for certification.8 The 1 Northrop Grumman Innovation Sys., Inc. v. Zurich American Ins. Co., 2021 WL 347015 (Del. Super. Ct. Feb. 2, 2021). 2 The Opinion resolved numerous other case-dispositive motions involving entities not parties to this appeal. 3 Northrop Grumman, 2021 WL 347015 , at **18-22. 4 Id., at **22-23. 5 Del. Supr. Ct. R. 42(b)(iii)(A). 6 Del. Supr. Ct. R. 42(b)(iii)(G). 7 Del. Supr. Ct. R. 42(b)(iii)(H). 8 Northrop Grumman Innovation Sys., Inc. v. Zurich American Ins. Co., 2021 WL 772312 (Del. Super. Ct. Mar. 1, 2021). 3 Superior Court agreed with the Alliant Insurers that the Opinion decided a substantial issue that relates to the merits of the case—that is, by affording Northrop a legal right to coverage, the Opinion imposes on the Alliant Insurers a legal duty to pay. But the Superior Court observed that a decision involving contract interpretation is not generally the type of undertaking worthy of interlocutory review. Nevertheless, the court examined the Rule 42(b)(iii) factors cited by the Alliant Insurers. The Superior Court concluded that the Opinion did not decide an issue of first impression but merely construed the terms of an insurance policy exclusion. Furthermore, the Superior Court noted that, although interlocutory review may terminate the litigation with respect to the Alliant Insurers, it would not terminate the litigation with respect to the remaining six, equally invested parties. The Superior Court also rejected the Alliant Insurers’ argument that the considerations-of-justice factor weighed in favor of certification: to the contrary, pausing litigation to permit interlocutory review where all of the parties share the same complaints cited by the Alliant Insurers (cost, time, pandemic-related conditions) would further strain—not promote—judicial economy. Finally, the court weighed the benefits and hardships of interlocutory review and concluded that there were no measurable advantages to certification. We agree with the Superior Court that interlocutory review is not warranted in this case. (5) Applications for interlocutory review are addressed to the sound 4 discretion of the Court.9 In the exercise of its discretion and giving great weight to the Superior Court’s analysis, this Court has concluded that the application for interlocutory review does not meet the strict standards for certification under Rule 42(b). Exceptional circumstances that would merit interlocutory review of the Superior Court’s decision do not exist in this case,10 and the potential benefits of interlocutory review do not outweigh the inefficiency, disruption, and probable costs caused by an interlocutory appeal.11 NOW, THEREFORE, IT IS ORDERED that the interlocutory appeal is REFUSED. BY THE COURT: /s/ James T. Vaughn, Jr. Justice 9 Del. Supr. Ct. R. 42(d)(v). 10 Del. Supr. Ct. R. 42(b)(ii). 11 Del. Supr. Ct. R. 42(b)(iii). 5

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http://courts.delaware.gov/Opinions/Download.aspx?id=318010

IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE RCS CREDITOR TRUST, ) ) Plaintiff, ) ) v. ) C.A. No. 2017-0178-SG ) ) NICHOLAS S. SCHORSCH; EDWARD ) M. WEIL, JR.; WILLIAM KAHANE; ) PETER M. BUDKO; RCAP HOLDINGS ) LLC; AR CAPITAL, LLC; AR ) GLOBAL INVESTMENTS, LLC; ) AMERICAN REALTY CAPITAL ) RETAIL ADVISOR, LLC; AMERICAN ) FINANCE ADVISORS, LLC; ) AMERICAN REALTY CAPITAL ) HEALTHCARE III ADVISORS, LLC; ) AMERICAN REALTY CAPITAL ) HOSPITALITY ADVISORS, LLC; ) NEW YORK CITY ADVISORS, LLC; ) GLOBAL NET LEASE ADVISORS, ) LLC; AMERICAN REALTY CAPITAL ) HEALTHCARE II ADVISORS, LLC; ) NEW YORK RECOVERY ADVISORS, ) LLC; and BDCA ADVISER, LLC ) ) Defendants. ) MEMORANDUM OPINION Date Submitted: February 8, 2021 Date Decided: March 18, 2021 Philip Trainer, Jr. and Marie M. Degnan, of ASHBY & GEDDES, Wilmington, Delaware; OF COUNSEL: John P. Coffey, Gregory A. Horowitz, Jeffrey S. Trachtman, and Leah S. Friedman, of KRAMER LEVIN NAFTALIS & FRANKEL LLP, New York, New York, Attorneys for Plaintiff RCS Creditor Trust. Daniel A. Mason, of PAUL, WEISS, RIFKIND, WHARTON & GARRISON LLP, Wilmington, Delaware; OF COUNSEL: Allan J. Arffa and Gregory F. Laufer of PAULL, WEISS, RIFKIND, WHARTON & GARRISON LLP, New York, New York, Attorneys for Defendants Nicholas S. Schorsch; Edward M. Weil, Jr.; William Kahane; Peter M. Budko; RCAP Holdings LLC; AR Capital, LLC; AR Global Investments, LLC; American Realty Capital Retail Advisor, LLC; American Finance Advisors, LLC; American Realty Capital Healthcare III Advisors, LLC; American Realty Capital Hospitality Advisors, LLC; New York City Advisors, LLC; Global Net Lease Advisors, LLC; American Realty Capital Healthcare II Advisors, LLC; New York Recovery Advisors, LLC; and BDCA Adviser, LLC. GLASSCOCK, Vice Chancellor 2  This matter involves breach of duty actions brought against a corporate controller and his affiliates, on behalf of the creditors of RCS Capital Corporation. That entity is bankrupt; the Plaintiff is a creditor trust. The Defendants have moved for summary judgment. A two-week trial looms in the immediate future. This brief and inelegant Memorandum Opinion grants the Defendants’ Motion with respect to one of the three discrete claims brought by the trust—the others remain for trial. My reasoning is below. I. BACKGROUND 1 The Plaintiff, RCS Creditor Trust, is a creditor trust that “has been assigned certain claims and causes of action” held by creditors of the now-bankrupt company, RCS Capital Corporation (“RCAP”).2 The Defendants are RCAP’s former controller, Nicholas S. Schorsch (“Schorsch”), and his affiliates. Schorsch controlled RCAP through his ownership (through an entity called RCAP Holdings LLC (“Holdings”)) of one share of Class B Common Stock, which held 50% plus one share of the voting interests in RCAP (the “Voting B Share”).3 A diagram of the relationships between the related parties and non-parties in this action is presented on the following page as Figure I. 1 I base the facts for this summary judgment ruling on the evidence submitted under affidavit with the parties’ papers as well as the parties’ pleadings where undisputed facts are involved. 2 Compl. ¶ 14; Answer ¶ 14. 3 The ARC Parties’ Opening Br. in Supp. of Their Mot. for Summ. J. 23, Dkt. No. 431 [hereinafter “MSJ OB”]; Pl.’s Answering Br. in Opp’n To The ARC Parties[’] Mot. for Summ. J. 23, Dkt. No. 454 [hereinafter “MSJ AB”]. 3  The Plaintiff alleges that the Defendants either breached their fiduciary duties or aided and abetted such a breach in connection with three sets of factual allegations: the so-called “core claim,” the “Cole claim,” and the “Apollo claim.”4 The Defendants have moved for summary judgment on all three of these claims. In this Memorandum Opinion, I deny the Motion for Summary Judgment (the “Motion”) as to the Cole claim, grant the Motion as to the Apollo claim, and reserve judgment on the core claim. 4 MSJ OB 3, 7; MSJ AB 42, 67, 69. 4  II. THE COLE CLAIM The Cole claim arises out of a failed deal between RCAP with American Realty Capital Properties, Inc. (the “Cole Parent”). The Cole Parent owned Cole Capital (“Cole”), a prominent distributor of real-estate investment trusts (“REITs”). In 2014, RCAP, which was in the business of providing services to REITs, including distribution services, sought to acquire Cole.5 Schorsch sat on both the RCAP board of directors (the “Board”) and on the Cole Parent board of directors.6 The parties agree that Schorsch recused himself from Board votes relating to a transaction with Cole. 7 During RCAP’s negotiations with the Cole Parent, the Cole Parent’s Audit Committee learned of potential misconduct regarding its—not Cole’s—accounting and initiated an investigation.8 The parties dispute what information Schorsch knew at the time regarding the investigation.9 However, the parties agree that the Cole Parent did not disclose any information regarding the investigation to RCAP.10 RCAP’s board voted in favor of the Cole transaction on September 30, 2014.11 5 MSJ OB 27; MSJ AB 32. 6 MSJ OB 27; MSJ AB 32. 7 MSJ OB 27–28; MSJ AB 32–33; Pre-Trial Stipulation ¶ 71, Dkt. No. 522. 8 MSJ OB 28; MSJ AB 33. 9 Compare MSJ OB 63, with MSJ AB 33. 10 See MSJ OB 28; MSJ AB 33. 11 MSJ OB 28; MSJ AB 33. 6  On October 29, 2014, the Cole Parent publicly disclosed the results of its internal investigation and committed to restating its financial statements.12 The Defendants note, and the Plaintiff did not dispute in either its briefing or at oral argument,13 that the misstatements that necessitated the restatements “did not relate in any way to the Cole Capital businesses that RCAP had contracted to purchase.”14 Regardless, RCAP’s board decided that it no longer wished to consummate the Cole Transaction and terminated the deal.15 In response, the Cole Parent sued RCAP and RCAP settled that litigation for $60 million. 16 The Plaintiff argues that Schorsch knew of the investigation prior to RCAP’s signing of the Cole transaction, owed RCAP a fiduciary duty to disclose the existence of the investigation, and that he failed to do so, thus breaching his fiduciary duties to RCAP and causing it to incur a $60 million loss. 17 The Defendants argue that Schorsch did not know enough about the substance of the investigation or about the Cole Parent’s accounting issues to disclose it to RCAP. 18 Relevant to the determination of the Cole claim are, among other things: what Schorsch knew; when he knew the information that he did know; what he did or did not do regarding what 12 MSJ OB 29; MSJ AB 33. 13 See MSJ AB 33–35; 2-8-21 Tr. of Oral Arg. on the ARC Parties’ Mot. for Summ. J. 78–81, Dkt. No. 510. 14 MSJ OB 29. 15 MSJ OB 29; MSJ AB 35. 16 MSJ OB 29; MSJ AB 35. 17 See MSJ AB 67. 18 MSJ OB 63. 7 he knew; and what involvement he had at RCAP after he knew material information, if he did know it.19 Those are all factual determinations that are better addressed with the benefit of trial. 20 Accordingly, the Defendants’ Motion for Summary Judgment on the Cole claim is denied. III. THE APOLLO CLAIM The Apollo claim arises out of RCAP’s 2015 negotiation of a deal with Apollo Global Management, LLC (“Apollo”) to the exclusion of a deal with Centerbridge Capital Partners III, L.P. (“Centerbridge”), allegedly at Schorsch’s bidding. Neither deal, I note, was consummated. 21 A. Background In January 2015, after the failure of the aforementioned Cole transaction, the Board believed that RCAP needed financing. To that end, it decided to “evaluate alternatives and potentially take action with respect to the Company’s wholesale business.” 22 On January 23, 2015, the Chairman of the Board, Mark Auerbach (“Auerbach”), informed the Board that “he believed that it was possible that Apollo 19 This is not meant to be an exhaustive, and should not be read as a preclusive, list of factual issues regarding this cause of action. 20 Indeed, the Defendants offer Schorsch’s deposition testimony in support of their position that he “did not learn about” the Cole Parent’s “accounting issues or the substance of [its] internal investigation before . . . October 1, 2014.” MSJ OB 63. Whether such testimony is credible is best determined at trial. 21 Transmittal Decl. Pursuant to 10 Del. C. § 3927 of Daniel A. Mason in Supp. of the ARC Parties’ Opening Br. in Supp. of Their Mot. for Summ. J. [hereinafter “MSJ OB Exs.”], Ex. 78, at -87507, Dkt. No. 432; Pre-Trial Stipulation ¶ 87, Dkt. No. 522. 22 MSJ OB Exs., Ex. 77, at -78768. 8 Global Management might make a proposal to acquire [RCAP’s wholesale distribution] business and that it was possible that Nicholas Schorsch or an affiliate of his may be a participant in a proposed transaction or related transaction.”23 Given Schorsch’s control over RCAP, the Board voted to establish a special committee of independent directors (the “Special Committee”) to consider the potential Apollo transaction and “any alternatives available to the Company other than the Proposed [Apollo] Transaction.” 24 Auerbach was designated the Chairman of the Special Committee. 25 Initially, the terms of the proposed Apollo transaction were that Apollo would transact with both RCAP and another Schorsch-affiliated entity, AR Capital, LLC (“AR Capital”).26 Apollo would separately purchase both RCAP’s wholesale distribution business, which provided distribution services for REITs, and a majority stake in AR Capital, with the latter contingent on the former. 27 As the Apollo transaction was being negotiated, however, RCAP received other overtures, including, on June 18, 2015, one from Ladenburg Thalmann (“Ladenburg”) and one from Centerbridge. 28 The Special Committee considered whether to engage with Ladenburg, but had concerns due to the lack of a written proposal, Ladenburg’s 23 Id. Schorsch did not attend this Board meeting. 24 Id. at -78769. 25 Id. 26 MSJ OB 30; MSJ AB 38. 27 MSJ OB 30; MSJ AB 38; MSJ OB Exs., Ex. 92, at § 5.2(k). 28 MSJ OB Exs., Ex. 78, at -87482. 9 status as a major client, and “the nature of the previous discussions being with respect to a stock-for-stock merger, which would not address the Company’s short- term needs.” 29 Despite these concerns, the Special Committee still authorized its financial advisor to engage with Ladenburg to see whether it could address RCAP’s short-term financial needs. 30 The proposed Centerbridge deal involved, among other things: (1) a potential $300-350 million investment in “convertible preferred stock”; (2) a rework of RCAP’s management arrangement (the “Services Agreement”)—because, in addition to being controlled by Schorsch, RCAP was also managed by a Schorsch- affiliated entity called RCS Capital Management, LLC (the “Manager”); and (3) a surrender of Schorsch’s Voting B Share—i.e., his controlling stake.31 The last two proposals, of course, would require Schorsch’s consent because they implicated rights held by entities he controlled. The proposed Centerbridge deal also contemplated that debt financing related to the deal, as well as “a portion of the funds from the Potential [Centerbridge] Transaction, would be used to repay the Company’s current secured credit facilities, including . . . the Series B preferred stock held by Luxor [Capital Group, LP]” 32 (“Luxor”), RCAP’s second largest 29 Id. 30 Id. at -87482, -87483. 31 MSJ OB Exs., Ex. 80; see MSJ OB 31. 32 MSJ OB Exs., Ex. 80. 10 stockholder after its controller. Centerbridge also noted that it saw value in converting “the Series C convertible preferred stock held by Luxor into common stock.”33 On June 27, 2015, “[t]he Special Committee unanimously agreed . . . to terminate further negotiations with Apollo and to refer Apollo to the Special Committee’s counterproposal, which was distributed to them on June 18, 2015, should Apollo desire to reengage the Company in further discussions regarding a potential transaction.” 34 Talks, however, did not actually end; on July 1, 2015, the Special Committee again discussed Apollo’s proposed terms. 35 And Auerbach, who was also the Special Committee Chairman, informed the Special Committee of discussions he had had with Apollo on June 30.36 The Special Committee also unanimously authorized Auerbach to continue engaging with both Apollo and Centerbridge, and to discuss the two proposals with Schorsch. 37 By July 14, 2015, the Special Committee was considering three potential transactions: the Apollo deal, the Centerbridge deal, and a Ladenburg deal.38 The Special Committee came to 33 Id. 34 MSJ OB Exs., Ex. 78, at -87489. 35 Id. at -87490. 36 Id. 37 Id. at -87491. 38 Id. at -87496. Although the potential for a Ladenburg deal was discussed, as well as some key terms that might go into such a deal, any Ladenburg deal does not appear to have progressed nearly as far as either the Centerbridge or Apollo potential transactions. 11  a general consensus as to the superiority of the Centerbridge transaction if it were doable given its requirement that the Company’s controlling shareholder surrender the control created by the [Voting B Share] and otherwise support the transaction. One director suggested that the Special Committee should pursue the proposed transaction with Centerbridge and potentially consider a subsequent strategic partnership with Apollo. 39 The Special Committee continued to discuss, in particular, the potential Centerbridge and Apollo transactions throughout July, including “the Centerbridge proposal’s requirement that the Company redeem [the Voting B Share] and terminate the Services Agreement [with the Manager], both of which would require the approval of Mr. Schorsch.”40 The Special Committee also discussed, only a week later, issues related to the ability of the Company to redeem the [Voting B Share], and whether Mr. Schorsch would be willing to clarify and explicitly agree as to the Company having such a redemption right and to agree to limit his ability to vote the [Voting B Share] in the interim, as required by the Centerbridge proposal. They also discussed Apollo’s proposed treatment of the [Voting B Share]. 41 On July 23, 2015, Auerbach informed the other Special Committee members that Apollo’s most recent term sheet was their final offer, which prompted discussion comparing the potential Centerbridge and Apollo transactions.42 The Special Committee then “discussed the key objectives any transaction should seek to 39 Id. at -87497. 40 Id. at -87499. 41 Id. at -87501. 42 Id. at -87502. 12 accomplish, including the desirability for a prompt infusion of capital and a plan to address concerns regarding management, and the reasons why it would be beneficial to be in a position to announce a transaction by August 6, 2015.”43 When discussing “the ability to enter into a transaction with either Centerbridge or Apollo by August 6, 2015,” however, Mr. Auerbach informed the Special Committee that Mr. Schorsch would not agree to any transaction with Centerbridge, given the extent of the dilution to existing shareholders that would result and his unwillingness to agree to give up the [Voting B Share] or its rights or to terminate the Company’s Services Agreement with [the Manager] (and certain other parties) in connection with the Centerbridge proposal.44 The Special Committee “then discussed the uncertainties surrounding the Company’s existing contractual rights related to the ability in the future to redeem the [Voting B Share], as well as how [it] would be dealt with under the terms of each of the Apollo and Centerbridge proposals.” The Special Committee concluded this meeting by “unanimously determin[ing] to send the Apollo and Centerbridge term sheets to the other members of the Board for their review and comment.” 45 Three days later, on July 26, Auerbach informed the Special Committee that (a) Apollo had requested an exclusivity agreement and (b) Centerbridge was asking for $2 million for expense reimbursement and $4 million for a break-up fee, absent 43 Id. at -87503. 44 Id. 45 Id. 13 which terms Centerbridge would cease diligence.46 While the Special Committee discussed whether to agree to Centerbridge’s demands, Auerbach noted that Schorsch “had reiterated his prior statements that he would not agree to a deal with Centerbridge, who had insisted on certain actions by Mr. Schorsch . . . be taken as part of any transaction, thus giving Mr. Schorsch the ability to block any such transaction.”47 After more discussion of both the Apollo and Centerbridge transactions, however, the Special Committee unanimously rejected both an exclusivity agreement with Apollo and the requests by Centerbridge for further expense reimbursement and a break-up fee arrangement—the latter, because of “Schorsch’s intention not to agree to a transaction with Centerbridge (which required his agreement to limit the use of the [Voting B Share] and to terminate the Services Agreement [with the Manager].” 48 On August 3, Auerbach informed the Special Committee that “a series of negotiations . . . had taken place earlier in the day between himself, on behalf of the Special Committee, Luxor, Apollo, Centerbridge[,] and Nicholas Schorsch.”49 However, “Schorsch and Centerbridge could not reach an agreement with respect to 46 Id. at -87505. 47 Id. 48 Id. at -87506. 49 Id. at -87507. 14 the treatment of the [Voting B Share] and that, as a result, Centerbridge would not be participating in an investment in the Company.”50 On August 5, two days after Centerbridge withdrew and one day before the Special Committee’s self-imposed goal of announcing a transaction by August 6 expired, RCAP’s CFO “advised the Special Committee that, absent a prompt infusion of capital, the Company might soon be unable to continue to meet its obligations.”51 After being advised by its financial advisor and its legal counsel, the Special Committee then unanimously approved a recommendation that RCAP enter into the proposed transaction with Apollo. 52 The terms of that transaction, which no longer included Apollo purchasing an interest in AR Capital, would include (a) the termination of the Services Agreement with the Manager, in exchange for a release of all claims against the Manager and affiliated entities (the “Release Agreement”), (b) a sale of preferred stock to Apollo, and (c) a sale of more preferred stock to Luxor. 53 While the Release Agreement was executed, the balance of the deal was never consummated. 54 The Release Agreement, which binds AR Capital, Schorsch, other members of the Board (who, together with Schorsch, are defined as the “ARC Principals”), 50 Id. 51 Id. at -87508. 52 Id. at -87511. 53 Id. at -87512, -87513, -787515. 54 Pre-Trial Stipulation ¶ 87, Dkt. No. 522. 15 RCAP, Holdings, and Luxor, was executed on November 8, 2015. 55 It provides that RCAP does hereby unequivocally release and discharge AR Capital, and the ARC Principals and any of their former and current subsidiaries, equity holders, controlling persons, directors, officers, employees, agents, [and] affiliates . . . from any and all past, present, or future liabilities, actions, claims or damages of any kind or nature . . . apparent or not apparent, foreseen or unforeseen, matured or not matured . . . from the beginning of time until the date of execution of this Agreement, that in any way . . . arises from or out of, are based upon, or are in connection with or relate in any way to or involve, directly or indirectly, any of the actions, transactions, occurrences, statements, representations, misrepresentations, omissions, allegations, facts . . . or any other matters . . . based on . . . the Transaction Documents and the transactions contemplated by the Transaction Documents . . . . 56 The “Transaction Documents” are defined to include an agreement between Apollo and AR Capital, an agreement between Apollo and the ARC Principals, and the agreement between Apollo and RCAP that was approved by the Board on August 6, 2015. 57 B. Analysis The Plaintiff summarizes the Apollo claim with the allegation that the Defendants “[r]efuse[d] [t]o [a]llow RCAP [t]o [p]ursue [a]ny [d]eal [b]esides the Apollo Transaction” and threatened the Special Committee into rejecting the 55 MSJ OB Exs., Ex. 96. 56 Id. at -652738. 57 Id. at -652737, -652738. 16 Centerbridge transaction. 58 In other words, the Defendants caused RCAP to lose the potential Centerbridge deal, theoretically damaging RCAP. It is important to note that this claim does not address the unconsummated Apollo deal itself, where Schorsch conceivably would have stood on both sides. Instead, the claim is that Schorsch acted to quash the Centerbridge deal. In their Motion for Summary Judgment, the Defendants argue that the Apollo claim has been released by the Release Agreement, and, further, that the Defendants did not refuse to allow RCAP to pursue other deals.59 To be entitled to summary judgment, the Defendants must first “establish that no material question of fact exists and they are entitled to relief as a matter of law.”60 Once they have made “a prima facie showing, with reasonable certitude” that no material question of fact exists, the burden shifts to the non-moving party, the Plaintiff, “to come forward with further evidence to demonstrate that there is a genuine issue of fact on the question.”61 If the Plaintiff discharges this burden, the Defendants “must then demonstrate that the [Plaintiff’s] evidence is legally 58 MSJ AB 38. The Complaint’s breach of fiduciary duty count against the Defendants with regards to the Apollo transaction are that the Defendants “us[ed] their control to prohibit the Special Committee of independent directors from pursuing a potential restructuring transaction with a counterparty other than Apollo.” Pl.’s Verified Compl. For Breach of Fiducary Duties ¶ 129, Dkt. No. 1. 59 MSJ OB 66–68. 60 Weinberger v. Rio Grande Indus., Inc., 519 A.2d 116 , 119 (Del. Ch. 1986). 61 Alcott v. Hyman, 208 A.2d 501 , 506–507 (Del. 1965). 17 insufficient to establish their claim.” 62 Further, because this is the Defendants’ motion, I “must view the evidence in the light most favorable to the” Plaintiff.63 The Defendants point to record evidence that they did not exert control over the Special Committee or independent directors in order to prevent them from exercising their business judgement on behalf of RCAP with regard to the Centerbridge or Apollo transactions. The Defendants, in their Opening Brief, note that the Board created a special committee of independent directors in light of Schorsch’s controller status, which committee was charged with analyzing the Apollo deal and soliciting alternatives.64 After Auerbach reported to the Special Committee that Schorsch would not consent to Centerbridge’s terms, the Special Committee nonetheless “unanimously agreed not to authorize execution of an exclusivity agreement with Apollo.”65 In further support of the committee’s independence, the Defendants cite66 to Special Committee minutes that show the Special Committee being informed of Schorsch’s position and, at the conclusion of that same meeting, “unanimously determin[ing] to send the Apollo and the Centerbridge term sheets to the other members of the Board for their review and 62 Mehan v. Travelers Ins. Co., 1988 WL 62793 , at *1 (Del. Ch. June 16, 1988). 63 In re El Paso Pipeline Partners, L.P. Deriv. Litig., 2014 WL 2641304 , at *1 (Del. Ch. June 12, 2014). 64 MSJ OB 30; MSJ OB Exs., Ex. 77. 65 MSJ OB 31 (quoting MSJ OB Exs., Ex. 78, at -87506). 66 See MSJ OB 31. 18 comment.”67 The Defendants also note that the Special Committee engaged with “various potential investment sources, including Apollo and Centerbridge[,]”68 and also cite to Special Committee minutes that show that the Special Committee also engaged with Ladenburg Thalmann. 69 Given that (a) the Special Committee considered a potential transaction with Ladenburg as well as Centerbridge and Apollo and (b) the Special Committee continued to consider the Centerbridge deal— even refusing an exclusivity arrangement with Apollo—after Schorsch’s stated opposition to the Centerbridge deal, the Plaintiff must come forward with some indicia the Defendants exerted control over the Special Committee with respect to its consideration of these transactions. 70 The Plaintiff’s Answering Brief presents only one factual allegation in rebuttal regarding the Defendants’ actions: that Schorsch allegedly “threatened” the Special Committee by telling Auerbach that he would not give up his Voting B Share or approve the termination of the Services Agreement in connection with the Centerbridge deal. 71 Of course, if a controller uses her voting control to bully directors, she has thereby assumed fiduciary duties. Such a threat robs the directors of the opportunity to put their business judgment on behalf of the entity over their 67 MSJ OB Exs., Ex. 78, at -87503 (emphasis added). 68 MSJ OB 68. 69 E.g., MSJ OB Exs., Ex. 78, at -87482. 70 See Alcott v. Hyman, 208 A.2d 501 , 507 (Del. 1965). 71 See MSJ AB 40, 69. 19 own—now threatened—interests. Here, however, the Plaintiff points to no record evidence that supports the existence of such a threat. The “threat” alluded to here is simply a statement that Schorsch would vote his stock in his business interest, in not giving up his contractual rights and majority ownership in order to approve the Centerbridge deal. This is not a threat to the independence of the Special Committee; it is simply a business decision that Schorsch communicated to the committee. A stockholder does not forfeit the right to exercise contract rights or to vote her stock merely by being a controller. 72 There is no duty for a controller to sacrifice on behalf of the company.73 Given that the evidence of record cited by the parties at this Summary Judgment phase shows that the Special Committee acted independently within its business judgment, and that Schorsch and the other Defendants did nothing but inform the committee that Schorsch would vote against what he perceived as a personally unfavorable deal, there simply are no factual questions for trial, and I conclude that the Defendants are entitled to summary judgment in their favor. 72 Ford v. VMware, Inc., 2017 WL 1684089 , at *15 (Del. Ch. May 2, 2017) (“Delaware courts consistently have held that a controlling stockholder’s fiduciary duty does not constrain its ability to vote its shares.”). 73 “Delaware law does not . . . impose on controlling stockholders a duty to engage in self-sacrifice for the benefit of minority shareholders. . . . As Chancellor Allen aptly wrote in Thorpe v. CERBCO, Inc., ‘[c]ontrolling shareholders, while not allowed to use their control over corporate property or processes to exploit the minority, are not required to act altruistically towards them.’” In re Synthes, Inc. S’holder Litig., 50 A.3d 1022 , 1040–41 (Del. Ch. 2012) (citing Thorpe v. CERBCO, Inc., 1993 WL 443406 , at *7 (Del. Ch. Oct. 29, 1993)). 20  Given this decision, I need not consider the applicability of the Release Agreement here. IV. THE CORE CLAIM Upon reviewing the parties’ briefing, I believe that the resolution of the core claim would benefit from the creation of a trial record.74 Accordingly, I will consider the summary judgment briefing on the core claim as part of the pre-trial briefing. V. CONCLUSION For the forgoing reasons, the Defendants’ Motion for Summary Judgment is denied in part and granted in part. The parties should submit a form of order consistent with this Memorandum Opinion. 74 “[T]he court may, in its discretion, deny summary judgment if it decides upon a preliminary examination of the facts presented that it is desirable to inquire into and develop the facts more thoroughly at trial in order to clarify the law or its application.” In re Energy Transfer Equity L.P. Unitholder Litig., 2017 WL 782495 , at *9 (Del. Ch. Feb. 28, 2017) (quoting In re El Paso Pipeline Partners, L.P. Deriv. Litig., 2014 WL 2768782 , at *9 (Del. Ch. June 12, 2014)). 21

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http://www.oscn.net/applications/oscn/DeliverDocument.asp?CiteID=487587

NOLEN v. STATE Skip to Main Content Accessibility Statement OSCN Found Document:NOLEN v. STATE Previous Case Top Of Index This Point in Index Citationize Next Case Print Only NOLEN v. STATE 2021 OK CR 5 Case Number: D-2017-1269 Decided: 03/18/2021 ALTON ALEXANDER NOLEN, Appellant v. STATE OF OKLAHOMA, Appellee. Cite as: 2021 OK CR 5, __ __ O P I N I O N ROWLAND, VICE PRESIDING JUDGE: ¶1 Appellant, Alton Alexander Nolen, was charged in the District Court of Cleveland County, Case No. CF-2014-1792, with First Degree Malice Murder (Count 1) in violation of 21 O.S.Supp.2012, § 701.7(A). He was also charged with Assault and Battery with a Deadly Weapon (Count 2) in violation of 21 O.S.2011, § 652 and Assault with a Dangerous Weapon (Counts 3-6) in violation of 21 O.S.2011, § 645, each After Former Conviction of Two or More Felonies. As to Count 1, the State sought the death penalty, and alleged four statutory aggravating circumstances in support thereof: (1) that Nolen was previously convicted of a felony involving the use or threat of violence to the person;1 (2) that Nolen knowingly created a great risk of death to more than one person;2 (3) that the murder was especially heinous, atrocious, or cruel;3 and (4) that there existed a probability that Nolen would commit criminal acts of violence that would constitute a continuing threat to society.4 ¶2 The jury imposed the death penalty on Count 1 after finding the existence of each alleged aggravating circumstance. It assessed punishment at life in prison on Counts 2, 4, and 5; fifty-five years imprisonment on Count 3, and seventy-five years imprisonment on Count 6. The Honorable Lori Walkley, District Judge, who presided at trial, sentenced Nolen accordingly and ordered the terms of imprisonment to be served consecutively. From this judgment and sentence Nolen appeals. We affirm. BACKGROUND ¶3 On September 25, 2014, Alton Nolen was working the bruschetta line with several other employees at Vaughn Foods in Moore, Oklahoma. One of his co-workers, Traci Johnson, who was new to the job, told him to stir the mixture more thoroughly and to put his back into it. She told him that he was lazy and that he needed to "man up." Nolen became defensive and agitated and said, "I hate white people, I beat white people up." Johnson ran from the line and reported the perceived threat to a supervisor, Timothy Bluford. After having Johnson write out a statement about the incident, Bluford spoke with Nolen and had him write out a statement as well. 5 Bluford advised Human Resources about the threat and subsequently delivered Nolen to a security guard who escorted him from the facility. Nolen was suspended pending an investigation. ¶4 After he left work, Nolen went back to his apartment where he retrieved a butcher knife. He returned to Vaughn Foods around 4:00 p.m. with the knife concealed in his boot. Although he no longer was authorized to enter, he gained access to the building by going inside through a door as another employee was leaving. Nolen went to the administrative area of the building where Colleen Hufford had stepped into Gary Hazelrigg's office to discuss a purchase order. As Hazelrigg glanced down to look at the document, he noticed movement in his peripheral vision. When Hazelrigg looked up, he saw Nolen grabbing Hufford from behind. ¶5 Nolen pinned Hufford's head to his body by putting his left forearm across her forehead, fully exposing her neck. Nolen held a knife in his right hand, which he drew across her throat inflicting a deep wound. As Hazelrigg rose from his chair to help Hufford, Nolen spun her around and pushed her out into an open area. When Hufford was on her back on the floor, Nolen straddled her and continued cutting her throat. Hazelrigg started screaming and trying unsuccessfully to pull Nolen off Hufford. Another employee, Sam Thurman, came upon the assault, ran toward Nolen, hit him, and tried to get him off Hufford. This was not successful; Nolen was not fazed and did not stop cutting Hufford's neck. Thurman left the area and yelled for help. He called 911 and then started telling people to leave. ¶6 Mark Vanderpool and Bryan Aylor were outside the building when they heard someone screaming for help and saying that someone was "cutting Colleen." They ran back into the building and came upon Nolen who was on the floor beside Hufford still cutting her neck with a knife. Hazelrigg was trying unsuccessfully to pull Nolen off Hufford. Vanderpool kicked Nolen under the chin as hard as he could with steel-toe boots. Nolen fell back slightly and then slashed toward Vanderpool with the knife. Vanderpool and two other employees ran from the area. Nolen stood up and Aylor grabbed his wrist. Aylor pushed Nolen up against a doorway but Nolen overpowered him causing Aylor to fall on his back to the floor. Aylor held Nolen's wrist and kicked at Nolen as Nolen tried to force the knife down to stab Aylor. Finally, Nolen just stood up and ran back to Hufford. Aylor jumped up and ran from the building. ¶7 When Nolen was interacting with the others, Hazelrigg made a quick phone call to 911. While Hazelrigg was on the phone, Nolen returned and continued to slice Hufford's neck with his knife. After Hufford's head was completely detached from her body, Nolen stood up and approached Hazelrigg before he became distracted and left the area. ¶8 Traci Johnson had just changed her clothes preparing to go home when she stepped out of the locker room and saw Nolen in the hall close to the administrative offices. She froze and was unable to move when she saw the bloody knife in his hand. Nolen rushed toward her and pushed her up against a wall. He held her with his forearm and started slicing her neck. Johnson tried pushing him away as she screamed for help. ¶9 As this was happening, Mark Vaughn, the chief operating officer of Vaughn Foods, who was aware of the situation and had retrieved an AR-15 from his vehicle, arrived at the hallway where the assault was occurring. Vaughn yelled at Nolen to stop. Nolen stopped and took a few steps toward Vaughn before turning around as if to run back to Johnson. Vaughn moved eight to ten feet closer to Nolen and as he did, Nolen turned and started running toward Vaughn holding the bloody knife over his head. When Nolen was about fifteen feet from him, Vaughn yelled at Nolen to stop and then fired three rounds at him in rapid succession. Nolen did not fall but leaned against the wall of the hallway and lowered himself to the ground still clutching the knife. Nolen had been hit by the gunshots and was in obvious distress. The police and EMTs arrived shortly and transported Nolen to the hospital. Johnson was also treated by the medics and taken to the hospital for wounds to her neck. She subsequently had surgery to repair damaged veins in her neck. ¶10 Nolen was interviewed at the hospital that same day by two Moore Police detectives and two FBI agents. Nolen advised them that he was a Muslim and that he had beheaded someone because he felt oppressed. Nolen explained that he worked at Vaughn Foods and a woman with whom he was working called him an immature brat and criticized the way he was doing his job. The woman got him into trouble and he was sent to Human Resources where he was told to go home for a couple of days. At home he retrieved a knife which he took back to work. When he went back into the building he assaulted the first woman and cut off her head because he felt oppressed. He explained that this was condoned by the Koran and that he intended to cut her head all the way off. The other woman he assaulted was the one who had disrespected him by calling him an immature brat. ¶11 Nolen was interviewed a second time a few days later on September 28, 2014. His account of what happened was substantially the same in the second interview. Nolen added, however, that he told the woman who called him an immature brat that he "beat on Caucasians." Nolen explained that up until the day of the assaults he had worked at Vaughn Foods for two years without incident; he went to work on time, had only missed one day, he prayed five times a day, did not steal, and had not fought with anyone. When he was pulled from the line and sent to Human Resources he felt discriminated against and oppressed. Nolen stated in the interview that he did not regret what he had done because it would probably make Vaughn Foods a better place for Muslims to work at in the future. ¶12 Prior to trial Nolen sought to enter a guilty plea and indicated that he wanted the death penalty. Defense counsel argued that Nolen was not competent to enter a plea first based upon intellectual disability and then based upon mental illness. Extensive competency hearings were held on both of these issues. While the trial court found that Nolen was not precluded from entering a guilty plea based upon intellectual disability or mental illness, by the time these issues had been litigated, Nolen was no longer speaking to defense counsel or the trial court. Although the trial court gave Nolen the opportunity to plead guilty prior to voir dire, Nolen sat mute with his fingers over his ears and did not respond. Accordingly, the defense entered a plea of not guilty by reason of insanity and the case proceeded to jury trial. 1. Ineligibility for Death Penalty ¶13 The United States Supreme Court has held that the Eighth Amendment prohibits the execution of intellectually disabled offenders. Atkins v. Virginia, 536 U.S. 304, 321 (2002). The issue of Nolen's alleged intellectual disability was raised below and an Atkins trial was held during which the jury heard testimony for five days. At the conclusion of the Atkins trial, the jury found that Nolen was not intellectually disabled. Nolen argues that this verdict was not supported by the evidence and that his death sentence must be vacated or modified. ¶14 The determination of whether a person is intellectually disabled is a question of fact and on appellate review, this Court gives great deference to the jury's finding. Lambert v. State, 2005 OK CR 26, ¶ 12, 126 P.3d 646, 653. This Court will not disturb the jury's verdict where "there is any competent evidence reasonably tending to support it." Howell v. State, 2006 OK CR 28, ¶ 41, 138 P.3d 549, 562. When the defendant challenges the sufficiency of the evidence following a jury finding that he is not intellectually disabled, "this Court will review the evidence in a light most favorable to the State to determine if any rational trier of fact could have reached the same conclusion." Id. See also 21 O.S.Supp.2019, § 701.10b (I).6 ¶15 While the United States Supreme Court held that the Constitution prohibits the execution of intellectually disabled offenders, it left "the task of developing appropriate ways to enforce the constitutional restriction" to the States. Atkins, 536 U.S. at 317 (quoting Ford v. Wainwright, 477 U.S. 399, 416-17 (1986)) (internal quotations omitted). The Supreme Court noted subsequently that this discretion is not without limitations. Hall v. Florida, 572 U.S. 701, 719 (2014)("Atkins did not give the States unfettered discretion to define the full scope of the constitutional protection"). Rather, determinations regarding claims of intellectual disability must be informed by the "views of medical experts." Id. at 721 ("It is the Court's duty to interpret the Constitution, but it need not do so in isolation. The legal determination of intellectual disability is distinct from a medical diagnosis, but it is informed by the medical community's diagnostic framework."). States may not adopt factors that reflect superseded medical standards or that substantially deviate from prevailing clinical standards. Moore v. Texas, 581 U.S. ___, 137 S.Ct. 1039, 1049 (2017) (while states have discretion in determining whether a defendant is ineligible for the death penalty due to intellectual disability they may not disregard current medical standards). ¶16 Oklahoma statutes addressing intellectual disability for purposes of the death penalty align with the federal constitutional requirements and specifically provide that, "no defendant who is intellectually disabled shall be sentenced to death." 21 O.S.Supp.2019, § 701.10b(B). A defendant seeking to avoid eligibility for imposition of the death penalty based upon intellectual disability must demonstrate: (1) significantly subaverage general intellectual functioning; (2) concurrent significant limitations in adaptive functioning; and (3) manifestation of the intellectual disability before age eighteen. 21 O.S.Supp.2019, § 701.10b(C). Where the issue of intellectual disability is considered and answered by the jury, "[t]he defendant has the burden of production and persuasion to demonstrate an intellectual disability to the jury by a preponderance of the evidence." 21 O.S.Supp.2019, § 701.10b(F). ¶17 We address each of the three required determinations in turn. Significantly Subaverage General Intellectual Functioning ¶18 Title 21 O.S.Supp.2019, § 701.10b(C) provides that "[a]n intelligence quotient of seventy (70) or below on an individually administered, scientifically recognized standardized intelligence quotient test administered by a licensed psychiatrist or psychologist is evidence of significantly subaverage general intellectual functioning . . . ." ¶19 Additionally, Section 701.10b(C) explicitly directs courts that "[i]n determining the intelligence quotient, the standard measurement of error for the test administrated shall be taken into account." ¶20 In May and June of 2015, Dr. Jeanne Russell, a licensed psychologist, administered to Nolen, individually, an intelligence quotient test. 7 Dr. Russell testified that she first administered a screening test commonly used within the psychological community -- the Wechsler Abbreviated Scale of Intelligence II (WASI-II). Based upon Nolen's score on the screening test, Dr. Russell determined a need to administer a full test. She administered the Wechsler Adult Intelligence Scale, Fourth Edition IQ test (WAIS-IV). Because she had administered the screening test so recently, Dr. Russell was concerned about the "practice effect" artificially inflating the test results.8 To remedy this potential problem, Dr. Russell used both the WASI-II and the WAIS-IV, omitting from the full test portions that she administered in the screening test. She testified that she "followed the directions that were published and took out some of the same tests that [she] had already done and plugged them into the places where [she] would have done similar tests, so [she] used that score." The final score was a 69. Dr. Russell testified that this score placed Nolen into the "mild range of intellectual disability" even given the standard error of measurement of plus or minus five points which would have placed his score in the range of 64-74. ¶21 Dr. Daniel Reschly, a self-described specialist in intellectual disability with a Ph.D. in school psychology, also testified for the defense. Dr. Reschly noted that to his knowledge the IQ test administered by Dr. Russell was "the only individually administered intelligence test that was a good test administered to Mr. Nolen." Dr. Reschly testified that in administering the test, Dr. Russell followed the publisher's procedures and that it was common to administer a screening test first and follow it with a more in-depth measure. When asked whether Nolen's effort in taking the test could have affected the score, Dr. Reschly testified that the test given by Dr. Russell contained an embedded measure of effort internal to the test; the WAIS-IV contains the Reliable Digit Span. Dr. Reschly testified that the test given to Nolen indicated that he gave strong effort in taking the test. Dr. Reschly concluded that Nolen's test score met the criteria of having a low IQ in the range associated with mild intellectual disability. ¶22 The State countered the testimony of the defense expert witnesses with the testimony of Dr. Jarrod Steffan, a psychologist whose practice involves the routine performance of intelligence testing. Dr. Steffan questioned the accuracy of Dr. Russell's test results and the validity of the IQ test. He testified that he found problems with both Dr. Russell's administration of the IQ test and with her scoring of the test. Additionally, Dr. Steffan questioned the effort Nolen put forth in taking the IQ test. ¶23 Dr. Steffan questioned Dr. Russell's method of deriving the final test score from a combination of screening subtests and test subtests. He testified that he would never give a screening test in a high stakes case like a death penalty case, although he acknowledged on cross-examination that there was a very high correlation rate between the WASI-II and the WAIS-IV. ¶24 Dr. Steffan also expressed concern that Dr. Russell did not properly follow the "discontinue rule" in administering two of the screening subtests. Dr. Steffan explained that under the "discontinue rule" if a person misses a certain number of items consecutively they are considered to have maxed out on how well they will do on that subtest, so the administrator moves on to the next subtest. He opined on direct examination that this failure to follow the protocol "may not be important in the grand scheme of things, but you simply don't know." He agreed on cross-examination that it was unlikely that compliance with the "discontinue rule" would have raised Nolen's score above a 75. ¶25 Dr. Steffan also noted that there were two different scoring documents for a single subtest; one was scored 18 and one was scored 20. However, he acknowledged that the score given to him and used by Dr. Russell in calculating the IQ test results was the higher score even though both gave the same skilled score and made no difference in the final computation. ¶26 Dr. Steffan also testified about the errors he found in the calculation of scores on one of the subtests. One of these errors had no impact and did not change the final score. The other error did impact the final test score and correcting this error changed the score from a 69 to a 70. ¶27 When addressing his concerns about the measurement of effort that Nolen put into taking the test, Dr. Steffan testified that the research findings regarding the embedded Reliable Digit Span are mixed on whether it is a decent predictor of a person's actual effort. Dr. Steffan testified that the research suggests that a stand-alone or other measure of effort should be used to compensate for the limitations of the Reliable Digit Span. ¶28 Dr. Steffan concluded that the numerous errors in the administration and scoring of the IQ test showed carelessness that undermined his confidence in the test results. He testified that because the test was improperly administered and scored, the IQ test was invalid. Although Dr. Steffan challenged the accuracy of the IQ test administered by Dr. Russell, he could provide no contradictory results. ¶29 That IQ tests are imprecise measurements of intellectual disability is well established. The United States Supreme Court noted that many factors affect an individual's IQ test score including, "the test-taker's health; practice from earlier tests; the environment or location of the test; the examiner's demeanor; the subjective judgment involved in scoring certain questions on the exam; and simple lucky guessing." Hall, 572 U.S. at 713 (citing American Association on Intellectual and Developmental Disabilities, R. Schalock et al., User's Guide To Accompany the 11th Edition of Intellectual Disability: Definition, Classification, and Systems of Supports 22 (2012) (AAIDD-11); A. Kaufman, IQ Testing 101, pp. 138--139 (2009)). The Supreme Court also recognized the tests themselves may be flawed or administered in a flawed manner. Id. at 714. ¶30 Despite their inherent fallibility, IQ tests are not determined, out of hand, to be invalid. Rather, to offset the fallibility of these tests, "[t]he professionals who design, administer, and interpret IQ tests have agreed, for years now, that IQ test scores should be read not as a single fixed number but as a range." Id. at 712. Accordingly, courts must take into account the test's "standard error of measurement" which "is generally thought to involve an error of measurement of approximately five points; hence, an IQ of 70 is considered to represent a band or zone of 65 to 75." Id. at 720 (quoting Diagnostic and Statistical Manual of Mental Disorders 28 (rev. 3d ed. 1987)). See also 21 O.S.Supp.2019, § 701.10b(C) ("In determining the intelligence quotient, the standard measurement of error for the test administered shall be taken into account."). ¶31 As noted above, Nolen's IQ test score -- even as corrected by Dr. Steffan - adjusted for the standard error of measurement yields a range of 65 to 75. Because the lower end of Nolen's score range falls at or below 70, which is within the range required to demonstrate significantly subaverage intellectual functioning, we move on to consider Nolen's adaptive functioning. Hall, 572 U.S. at 723 ("[W]hen a defendant's IQ test score falls within the test's acknowledged and inherent margin of error, the defendant must be able to present additional evidence of intellectual disability, including testimony regarding adaptive deficits."). See also Moore, 581 U.S. at ___, 137 S.Ct. at 1050 ("[I]n line with Hall, we require that courts continue the inquiry and consider other evidence of intellectual disability where an individual's IQ score, adjusted for the test's standard error, falls within the clinically established range for intellectual-functioning deficits."). Significant Limitations in Adaptive Functioning ¶32 Next, Nolen was required to demonstrate he suffers significant limitations in adaptive functioning. Title 21 O.S.Supp.2019, § 701.10b(A)(2) provides that "'[s]ignificant limitations in adaptive functioning' means significant limitations in two or more of the following adaptive skill areas: communication, self-care, home living, social skills, community use, self-direction, health, safety, functional academics, leisure skills and work skills . . . ." Nolen argues on appeal that he made the requisite showing. ¶33 As with an evaluation of general intellectual functioning, a determination of deficits in adaptive functioning must be informed by the medical community's diagnostic framework. Moore, 581 U.S. at ___, 137 S.Ct. at 1050. Furthermore, "the medical community focuses the adaptive-functioning inquiry on adaptive deficits." Id. (emphasis in original) (citing AAIDD--11, at 47 ("significant limitations in conceptual, social, or practical adaptive skills [are] not outweighed by the potential strengths in some adaptive skills")). See also Brumfield v. Cain, 576 U.S. 305, 320 (2015) ("[I]ntellectually disabled persons may have 'strengths in social or physical capabilities, strengths in some adaptive skill areas, or strengths in one aspect of an adaptive skill in which they otherwise show an overall limitation.'" (quoting American Association of Mental Retardation, Mental Retardation: Definition, Classification, and Systems of Supports 8 (10th ed. 2002)). Accordingly, in order to avoid overemphasis of adaptive strengths and lay stereotypes, our review focuses primarily, but not exclusively, on the expert testimony regarding Nolen's adaptive functioning deficits rather than on lay testimony about Nolen's adaptive strengths. 9 ¶34 Nolen presented evidence of his adaptive functioning deficits through the testimony of two experts. His first expert, Dr. Russell testified that she assessed Nolen's adaptive functioning capacities after administering the Vineland Adaptive Behavior Scales II (Vineland II) assessment. In order to complete the Vineland II assessment Dr. Russell reviewed Nolen's school records, spoke with Nolen, who she believed was not forthcoming, and interviewed his sister, Paige Nolen. Dr. Russell testified on direct examination, without much explanation, that based upon her conversations with Paige Nolen, she found that Nolen had significant adaptive functioning deficits in the areas of self-care, social skills, self-direction, health and safety, and functional academics. ¶35 Defense expert witness Dr. Reschly testified in more detail. He explained that current criteria for intellectual disability are established by the American Association on Intellectual and Developmental Disabilities (AAIDD) and the American Psychiatric Association's Diagnostic and Statistical Manual of Mental Disorders Fifth Edition (DSM-5). He testified that the skill areas listed in Section 701.10b(A)(2) mirror the 1992 AAIDD classification manual. However, based upon adaptive behavior research, the 2002 AAIDD classification manual changed the categories into three, broader domains of adaptive behavior: conceptual, social, and practical. Dr. Reschly testified that despite this organizational change, the skills listed in the Oklahoma statute are encompassed within the three modern domains of adaptive behavior. ¶36 Dr. Reschly testified that the conceptual domain includes the use of language and literacy skills as well as the understanding and use of numbers relating to money and time. The social domain, he explained, has to do with social responsibility, getting along with others, following rules, and the degree to which one is gullible or easily tricked or cheated. Dr. Reschly testified that the practical domain encompasses basic self-care skills as well as more complex skills such as work, handling money, protecting one's health and safety, transportation, and use of technology. Dr. Reschly testified that he looked at a wide variety of information in forming an opinion about Nolen's adaptive behavior and he gave detailed testimony about the basis for his conclusions. ¶37 Dr. Reschly concluded that Nolen has significant deficits in some areas covered by the conceptual domain based upon his review of school records and interviews with people who knew Nolen during his years in school. Paige Nolen told Dr. Reschly that Nolen had difficulties with reading and language and that Nolen was retained in first grade because he had difficulty with reading and basic arithmetic. Dr. Reschly testified that although Nolen scored in the 60th percentile his second year of first grade, his scores on the Iowa Test of Basic Skills declined as he advanced through school. ¶38 Dr. Reschly learned from both Paige Nolen and some of Nolen's classmates that they believed Nolen was in special education classes in middle school and high school. 10 Dr. Reschly agreed on cross examination, however, that while he believed it likely that Nolen was in special education prior to high school, nobody in the school system said that Nolen was in special education classes at any time -- elementary school, middle school, or high school.11 ¶39 The pattern of declining achievement continued and in high school Nolen did poorly, generally receiving failing or near failing grades. He was in a credit recovery curriculum at Booker T. Washington Academy his 10th through 12th years of high school. Dr. Reschly testified that in his experience, the life skills curriculum teaches practical skills to people with mild intellectual disability.12 While Dr. Reschly testified that the classes Nolen took at Booker T. Washington were the type of life skills courses often used by persons with mild intellectual disability, he acknowledged that these classes served the additional purpose of credit recovery. Dr. Reschly also acknowledged that in addition to four life skills classes, Nolen took English II, English III, AP math I, AP math II, world history, and government while at Booker T. Washington his junior year. He took fine arts, math of fin., auto 1, earth science, English IV, and track his senior year. None of these classes were noted to be life skills classes. Nolen graduated from high school with a 2.09 GPA. ¶40 After high school Nolen attended Carl Albert and Langston University. 13 Nolen took developmental classes at Carl Albert to help him overcome deficits in academic skills. Nolen's grades were mostly Ds and Fs in these classes although while at Langston University he received an A in a psychology class and an A in an academic achievement seminar. ¶41 Dr. Reschly also concluded that as a child, adolescent, and adult Nolen had significant deficits in some of the adaptive skill areas within the social domain. Dr. Reschly spoke with Nolen's natural father, who said that Nolen had very poor decision-making skills and that he was easily exploited. Additionally, Dr. Reschly testified that others who knew Nolen well told him that Nolen had difficulty reading people and understanding appropriate social behaviors. Two of his childhood friends from football told Dr. Reschly that when they went to parties, Nolen would not interact with others; he would sit in the car and not participate. Some school peers relayed to Dr. Reschly that Nolen was frequently unable to follow conversations. 14 Although Nolen was a football player and understood when a game was coming up, he would not know who the opposing team was. He was described by family and peers as someone who was gullible and easily influenced by others; kids would ask him for money and he would give it to them.15 ¶42 Dr. Reschly testified that Paige Nolen told him that as an adult, Nolen did not have many friends and did not go out or interact with others; he was not socially connected.16 While Nolen was socially active on Facebook, his interactions there were sometimes socially inappropriate; he contacted women he had never met and asked if they would marry him and bring a dowry to the marriage. Additionally, Dr. Reschly said that Nolen's language and intellectual processing limitations hindered his social problem solving abilities at work.17 On cross-examination, however, Dr. Reschly acknowledged that there was evidence that Nolen participated in social networks by going to the mosque on a semiregular basis. Despite his testimony that social behaviors may impede a person's ability to keep a job, Dr. Reschly acknowledged that prior to his commission of the crimes in this case, Nolen kept his job at Vaughn Foods for over a year. ¶43 Dr. Reschly testified that in the practical domain, Nolen displayed no significant deficiencies. Dr. Reschly found that Nolen met the basic expectations regarding the activities of daily living; he practiced self-care, lived independently and maintained his household, drove, held a job, and used technology. Dr. Reschly testified, however, that the ability to perform these functions neither proves nor disproves intellectual disability. While Dr. Reschly noted that Nolen had some weaknesses in the area of practical skills domain, his deficits were not significant limitations. ¶44 In conclusion, Dr. Reschly testified that Nolen's deficits in the modern category of conceptual domain equates to a finding of significant limitations in the adaptive skill areas of communication and functional academics under Section 701.10b(A)(2). His deficits in the modern category of social domain equates to a finding of significant limitations in the adaptive skill areas of social skills and leisure skills under Section 701.10b(A)(2). Finally, he concluded that Nolen had no significant limitations in the modern category of practical domain. ¶45 The State's expert witness, Dr. Steffan, disagreed with the conclusions reached by the defense expert witnesses finding flaws in their assessment and reaching different conclusions based upon much of the same evidence. Dr. Steffan agreed that the Vineland II test administered by Dr. Russell is an acceptable test to assess adaptive function. He did not, however, agree with the conclusion reached by Dr. Russell and Dr. Reschly that based upon the administration of this test, Nolen had significant deficits in two or more of the adaptive skill areas listed in Section 701.10b(A)(2). ¶46 Dr. Steffan testified that the Vineland II test results are only as reliable as the reporting upon which the test results are based. He testified that the person providing information for the Vineland II test should be "a person who knows the person well, who has known the person well over a long period of time, and who has known the person well in the recent past. A person who has frequent or regular contact with the individual." ¶47 Dr. Steffan was concerned that Paige Nolen was a biased reporter to Dr. Russell and that she did not possess a solid basis of knowledge regarding Nolen's adaptive skills. For instance, Dr. Russell testified that she relied upon Paige Nolen to conduct the Vineland II test because she was the only family member who would talk to her and because Nolen lived with her when they were children and when he got out of prison. However, as Dr. Steffan noted, other evidence showed that Paige Nolen had a limited basis of knowledge; she testified at trial that she lived with Nolen only part of the time when they were in elementary and middle school although they lived together during high school. Then Nolen lived with her for a short time after he got out of prison the first time; he moved out to move in with a girlfriend. Later, after he got out of prison the second time, he lived with her for three months before he moved into his own apartment. After he moved into his own apartment, Paige Nolen only visited him there once. Dr. Steffan testified that this sporadic contact gave Paige Nolen only a limited basis of knowledge allowing her to provide "probably unreliable information." ¶48 Dr. Steffan disagreed with Dr. Russell's and Dr. Reschly's conclusions about Nolen's skills in the area of functional academics. He noted that Dr. Russell estimated Nolen's reading ability to be at the fourth grade level. Dr. Steffan testified that people generally do not know the level of reading associated with the different grades indicating that one could not put much stock in Paige Nolen's reported estimate of Nolen's reading level. He testified that the average reading level in the United States is sixth grade, which is precisely the level at which Nolen scored when he took an the Test of Adult Basic Education (TABE) administered by the Department of Corrections when he went into prison at the age of twenty-seven. 18 ¶49 Dr. Steffan also noted that on the TABE Nolen scored in the 19th percentile in mathematic computations and 45th percentile in applied mathematics making his total math score in the 32nd percentile. While low, Dr. Steffan testified that this score placed Nolen within the average range. Finally, Dr. Steffan noted that Nolen scored in the 85th percentile in language on the TABE placing his cumulative score at the 58th percentile, within the average range. Dr. Steffan acknowledged the differences between Nolen's test scores on the IQ test, the Vineland II, and TABE, noting that the higher scores would be a result of best effort because "you can't fake having better intelligence" but one can put forth less effort to produce a lower test score. ¶50 Dr. Steffan also disagreed with Dr. Reschly's conclusions about Nolen's communication skills. He referenced a letter purportedly handwritten by Nolen while in prison to the director of the Department of Corrections. Dr. Steffan testified that the letter included identification, an introduction, persuasive argument, and concluded with well wishes for the recipient. Dr. Steffan acknowledged that the letter had some grammatical and typographical errors but the sentences were complete. Dr. Steffan also noted that he reviewed Facebook posts made by Nolen and while these were less formal, Nolen expressed understandable points and wrote in complete sentences. 19 ¶51 While Dr. Steffan specifically found no significant deficiencies in Nolen's functional academic and communication skills, he did not disregard that Nolen has some adaptive functioning deficits in the way he deals with his life. Dr. Steffan diagnosed Nolen with unspecified personality disorder with antisocial traits and attributed his adaptive functioning issues to the personality disorder. In conclusion, however, Dr. Steffan testified that he was unable to find any significant deficits in adaptive functioning due to intellectual disability. ¶52 As noted above, the opinions of the three experts about Nolen's limitations in adaptive functioning varied greatly. The defense experts only agreed with each other that Nolen suffered significant limitations in the two areas of functional academics and social skills. While each of them found significant limitations in other adaptive skill areas, they did not agree with each other about these; Dr. Russell found significant limitations in the skill areas of self-care, self-direction, and health and safety while Dr. Reschly found significant limitations in the skill areas of communication and leisure skills. 20 In contrast, while Dr. Steffan acknowledged that Nolen had some adaptive functioning deficits, he did not find any of these to be significant. ¶53 With the exception of Dr. Russell who largely gave conclusory opinions without detailed explanation, Dr. Reschly and Dr. Steffan spoke to the evidence and explained their conclusions. Both indicated that their conclusions were informed by the Vineland II administered by Dr. Russell, interviews with Nolen, Nolen's known academic record, and interviews with people who knew Nolen. They discussed how they reached their conclusions and the evidence upon which their conclusions were based. Each of the expert witnesses formed their opinions with regard to established medical practice and current medical standards. However, their conclusions about Nolen's adaptive functioning limitations were conflicting. Considering the testimony of the medical experts and the evidence that either supported their conclusions or refuted them, without giving undue emphasis to lay stereotypes or evidence of adaptive strengths, the jury could have found that Nolen failed to demonstrate, by a preponderance of the evidence, that he had significant limitations in two or more of the enumerated adaptive skills areas. Manifestation Before the Age of Eighteen ¶54 Finally, Nolen was required to show that the onset of his intellectual disability manifested before he reached the age of eighteen. 21 O.S.Supp.2019, § 701.10b(C). He avers that he has made this showing. ¶55 Dr. Russell acknowledged the statutory requirement that the onset of intellectual disability manifested before the age of eighteen. She testified that the fact that Nolen was not administered an IQ assessment before the age of eighteen is not critical to the issue of age of onset. Dr. Russell noted Nolen's social deficiencies and his poor grades in elementary school, high school, and college, and the evidence that his sister helped him in school. She testified generally and briefly that his intellectual disability manifested before he reached the age of eighteen. ¶56 Dr. Reschly also testified that intellectual disability may be determined to have manifested before the age of eighteen even absent an early IQ test or official diagnosis as a child. He testified that Nolen's "low performance was certainly noticed before the age of 18 even though the IQ test - - as far as we know, the only IQ test given to him occurred after he was age 18 - - and that IQ test showed a very low intellectual functioning." ¶57 Finally, Dr. Steffan testified that he considered Nolen's grade school, middle school, and high school records to assess whether the onset of intellectual disability manifested before Nolen reached the age of eighteen. Dr. Steffan found it significant that in Nolen's testing from grade school, his scores ranged from the 2nd percentile to the 99th percentile on the different areas of academic skills. Dr. Steffan testified that this showed that Nolen was "doing variably. He did really well in some areas and poorly in other areas." Dr. Steffan noted that other factors could have affected his grades such as transitions from different schools and instability at home. Dr. Steffan also noted that the only time he was able to discern that Nolen had academic assistance was during 10th, 11th, and 12th grades when he was in the credit recovery program that "was separate from students who had intellectual disabilities or learning disorders or received special education services." Dr. Steffan relied upon school records, transcripts of testimony from school officials, educators, family, friends, and Nolen himself to determine that Nolen was not in special education. He also looked at Department of Corrections records and tests Nolen took there which did not indicate onset of intellectual disability before the age of eighteen. Based upon this evidence, Dr. Steffan concluded that Nolen did not show noticeable signs of intellectual disability before the age of eighteen. ¶58 As noted in the discussion above, the testimony by the expert witnesses with regard to the age of onset of Nolen's alleged intellectual disability conflicted. The defense expert witnesses testified that it manifested before the age of eighteen and the State's witness testified that it did not. The jury, in finding that Nolen does not suffer from intellectual disability, apparently reached the same conclusion regarding the age of onset as the State's expert witness. This conclusion was not an unreasonable determination of the facts. ¶59 The defense bore the burden of production and persuasion to demonstrate, by a preponderance of the evidence, that Nolen suffered significantly subaverage general intellectual functioning contemporaneously with significant limitations in at least two of the enumerated areas of adaptive functioning and that this intellectual disability manifested before the age of eighteen. The evidence, viewed in the light most favorable to the State, supports the jury's finding that Nolen did not show, by a preponderance of the evidence, that evidence of intellectual disability manifested before the age of eighteen. This proposition is denied. 2. Competency ¶60 Nolen complains that he was tried while incompetent to assist in his own defense, in violation of his right to due process of law as guaranteed by Fourteenth Amendment to the United States Constitution. The constitutional guarantee of due process of law includes the right to be tried only when one is sufficiently competent to understand the nature of the charges and to assist counsel in preparing a defense. Cooper v. Oklahoma, 517 U.S. 348, 354 (1996); Drope v. Missouri, 420 U.S. 162, 171-72 (1975). The standard for competency to stand trial is "whether [the defendant] has sufficient present ability to consult with his lawyer with a reasonable degree of rational understanding - and whether he has a rational as well as factual understanding of the proceedings against him." Dusky v. United States, 362 U.S. 402, 402 (1960). Oklahoma has codified these constitutional requirements. See 22 O.S.2011, § 1175.1(1) (a person is competent to stand trial if he has "the present ability . . . to understand the nature of the charges and proceedings brought against him or her and to effectively and rationally assist in his or her defense"). The law presumes competence, requiring the defendant prove his incompetence by a preponderance of evidence. Grant v. State, 2009 OK CR 11, ¶ 8, 205 P.3d 1, 8 (citing Medina v. California, 505 U.S. 437, 452-53 (1992)). ¶61 There are two types of competency claims. "A procedural competency claim is based upon a trial court's alleged failure to hold a competency hearing, or an adequate competency hearing, while a substantive competency claim is founded on the allegation that an individual was tried and convicted while, in fact, incompetent." Lay v. Royal, 860 F.3d 1307, 1314 (10th Cir. 2017) (quoting McGregor v. Gibson, 248 F.3d 946, 952 (10th Cir. 2001) (en banc) (internal quotations omitted)). Nolen makes a substantive competency claim as he raised the issue early in the prosecution and he was found not to have proven his incompetency by a preponderance of the evidence in either of two separate, lengthy hearings, each of which we review in turn. We review the trial court's finding of competence for an abuse of discretion. Grant, 2009 OK CR 11, ¶ 9, 205 P.3d at 8. An abuse of discretion is a conclusion or judgment that is "clearly against the logic and effect of the facts presented." State v. Hooley, 2012 OK CR 3, ¶ 4, 269 P.3d 949, 950. Competency Related to Intellectual Disability ¶62 On March 25, 2015, defense counsel filed an application for determination of competency. On this same date, the district court issued an order for the determination of competency. The order required that a doctor or doctors from the Oklahoma Department of Mental Health examine Nolen and make the following determinations required by 22 O.S.2011, § 1175.3(E): 1. If the person is able to appreciate the nature of the charges made against such person; 2. If the person is able to consult with the lawyer and rationally assist in the preparation of the defense of such person; 3. If the person is unable to appreciate the nature of the charges or to consult and rationally assist in the preparation of the defense, whether the person can attain competency within a reasonable period of time as defined in Section 1175.1 of this title if provided with a course of treatment, therapy or training; 4. If the person is a person requiring treatment as defined by Section 1-103 of Title 43A of the Oklahoma Statutes; 5. If the person is incompetent because the person is intellectually disabled as defined in Section 1408 of Title 10 of the Oklahoma Statutes; 6. If the answers to questions 4 and 5 are no, why the defendant is incompetent; and 7. If the person were released, whether such person would presently be dangerous as defined in Section 1175.1 of this title. Nolen was examined as ordered and a competency hearing was held on October 26 and 27 of 2015. This competency hearing focused on whether Nolen was incompetent to stand trial due to mild intellectual disability. ¶63 The primary witness for the defendant at the competency hearing was Dr. Jeanne Russell who testified that she interviewed Nolen a cumulative total of seven hours on May 28, 2015 and June 30, 2015. During her time with Nolen, she administered four different tests. She testified that she administered the FIT-R, a standardized test to evaluate competency - whether a defendant has a factual understanding of the proceedings and the ability to assist in his defense. She concluded from the administration of this test that Nolen was aware of his arrest and the charges against him but he was confused about the roles of the officers of the court and he distrusted his attorneys. He wanted the death penalty and was not willing to participate in his defense. 21 ¶64 Dr. Russell also administered another standardized competency evaluation, the ECSR-R. During the administration of this test, Nolen insisted that he wanted the death penalty and he stated his intent to refuse to work with his attorneys on a different outcome. He was again unclear about the roles of the officers of the court. ¶65 Similar to her testimony during Nolen's intellectual disability trial discussed above in Proposition One, Dr. Russell testified that she administered the WASI-II, an IQ screening test, and the WAIS-IV, a full IQ test, and combined both to determine an overall IQ score of 69. 22 She also testified that in order to assess Nolen's adaptive functioning, she administered the Vineland II and reached her conclusions after speaking with Nolen's sister, Paige Nolen, and reviewing existing school records. Dr. Russell testified that Nolen scored low in the three main areas of communication, daily living skills, and social skills.23 Dr. Russell noted at this hearing that the most difficult prong of intellectual disability to diagnose in Nolen's case is the requirement that the significant limitations in adaptive functioning manifest before the age of eighteen. She testified about limitations and behavior observed in Nolen before the age of eighteen -- such as academic performance -- but she did not address this prong in detail. ¶66 Dr. Russell concluded her testimony at this competency hearing by answering the questions required in the district court's order. With regard to the first two questions she testified that Nolen understood the charges against him but was not able to consult with the lawyer and rationally assist in the preparation of his defense; he was "unable or unwilling to consult with counsel." She added, "whether he has the capacity to do so is difficult to say; but, in my opinion, he lacks the capacity to plan his legal strategies and work with a lawyer in doing that." She found this, in part, because of his communication and higher reasoning limitations. She also based her opinion in part on his refusal to talk about any defense. Dr. Russell testified in response to question three that although Nolen's IQ score was low, she believed it possible that he could attain competency within a reasonable amount of time. She was not sure that this was possible but she testified that, "it would be worth a try." With regard to the fourth question, Dr. Russell testified that Nolen was not a person requiring treatment as defined by Section 1-103 of Title 43A because he was not showing symptoms of psychosis or mental illness requiring hospitalization. In answer to question five, Dr. Russell testified that Nolen was incompetent because of major deficits in his intellectual functioning based upon the results of the IQ tests and the adaptive functioning test. Question six was inapplicable because of the answers to questions four and five. Finally, in answer to question seven, Dr. Russell testified that Nolen was not presently dangerous as defined in Section 1175.1. ¶67 Dr. Shawn Roberson, a forensic psychologist, was the State's expert witness at the first competency hearing. Dr. Roberson testified that he evaluated Nolen on April 6, 2015, pursuant to the district court's order of March 25, 2015. In preparing for the evaluation, Dr. Roberson reviewed the case information. He testified that there was not an extensive amount of information available in Nolen's case but he noted that although Nolen had a criminal history with multiple prior convictions, there were no records indicating that competency had been an issue in the past. Dr. Roberson also testified that Nolen was not currently on any medication or receiving any treatment. ¶68 Dr. Roberson interviewed Nolen at the Cleveland County Detention Center. During the interview Nolen was generally cooperative but made it clear that he was not happy that his competency was challenged. From his examination, Dr. Roberson was able to answer the questions required by the court's order. ¶69 In response to the first question, Dr. Roberson testified that Nolen was able to appreciate the nature of the charges against him; Nolen knew that he was charged with murder and assault for beheading a woman at Vaughn Foods and cutting another woman's throat. In addition to understanding the crimes charged, Nolen knew that he was facing the punishment of the death penalty or life in prison. ¶70 With regard to the second question, Dr. Roberson testified that Nolen was able to consult with his attorneys and rationally assist in the preparation of a defense. He noted, however, that while Nolen was able to assist his attorneys, he was not willing to do so. Dr. Roberson testified that the issue was whether Nolen had any impairment, mental illness, cognitive deficit, or other medical condition that would preclude him from rationally assisting his attorney or making decisions about how to proceed in the case. He testified that Nolen's decision-making was not delusional or the result of a mental impairment. Dr. Roberson testified that if Nolen wanted to, he could assist his attorneys as he was able to articulate circumstances he believed mitigated his case; he believed he had been mistreated at work. He also could compose his behavior in court and he knew how he was expected to act; Nolen told Dr. Roberson that as long as no one offended him he would act appropriately. Dr. Roberson added that Nolen acted appropriately throughout the interview. ¶71 Dr. Roberson testified that because Nolen was able to appreciate the nature of the charges and to consult with and rationally assist in the preparation of a defense, question three was inapplicable. ¶72 With regard to question four, Dr. Roberson testified that Nolen was not a person requiring treatment as defined by Section 1-103 of Title 43 as there was no indication that Nolen had a history of mental health treatment or serious mental illnesses. Dr. Roberson noted that Nolen denied having any symptoms associated with serious mental illness and "didn't exhibit any signs that would be associated with a severe mental illness that would require his commitment to a psychiatric facility." ¶73 In response to question five, Dr. Roberson testified that "there was absolutely no data to suggest that Mr. Nolen had mental retardation." 24 He added that if he had a concern about intellectual disability, he would have noted it in his report and still have found Nolen to be competent because, "[you] can have mild intellectual [ ] disability and still be competent." ¶74 Finally, Dr. Roberson testified that question six was inapplicable and, with regard to question seven, he found that Nolen was not presently dangerous due to mental illness. ¶75 When asked about the variance between his assessment and Dr. Russell's, Dr. Roberson questioned Dr. Russell's administration of the IQ tests, opining that it was flawed. He questioned Nolen's effort in taking the IQ test and he opined that Dr. Russell scored Nolen low because he provided answers based upon his ideology rather than giving answers Dr. Russell would have considered appropriate. With regard to Dr. Russell's conclusions regarding Nolen's adaptive functioning, Dr. Roberson noted that Dr. Russell derived the bulk of her information from Nolen's sister who, Dr. Roberson opined, may not have given accurate information; the results are "completely dependent upon the accuracy of the informant." While acknowledging Nolen's largely poor academic performance, Dr. Roberson noted that Nolen performed better academically in early elementary school and that he got a few As in college courses. He testified that one would not expect an individual functioning as poorly as Dr. Russell reported to outperform peers to that degree in early elementary school or to earn an A in a college psychology course. Dr. Roberson testified that he found no legitimate evidence that Nolen was intellectually disabled. Nolen was, he concluded, competent to stand trial. ¶76 The district court ruled on the competency hearing in a Summary Order issued on October 28, 2015. The district court first noted that 22 O.S.2011, § 1175.4 presumes that persons are competent and when a defendant places his competency in question he has the burden of proving incompetency by a preponderance of the evidence. The district court also noted that the only disputed issue before the court was whether Nolen had presented sufficient evidence that he was "not competent due to mental retardation that would prohibit [him] from providing meaningful assistance in his defense." The district court found that under the preponderance of the evidence standard, the defense had shown both an IQ score of seventy or below and that evidence of sub-average intellectual functioning occurred before the age of eighteen.25 The district court concluded, however, that the defense did not show by a preponderance of the evidence that Nolen "possessed any of the requisite cognitive/adaptive skill deficits set forth in the statute." The court concluded that "[b]ased on the totality of the evidence, it is clear that he does not." The district court concluded that Nolen did not present evidence meeting the statutory definition of mental retardation and noted evidence indicating his understanding of the charges and his ability to assist in his defense. The district court found that Nolen was competent to undergo further criminal proceedings in the matter. The district court's ruling is supported by the record and was not an abuse of discretion. Competency Related to Mental Illness ¶77 Formal arraignment was held on February 11, 2016. At this proceeding, Nolen was communicative and answered the questions asked by the trial court. 26 Defense counsel voiced concern that Nolen did not understand or know of all of the counts charged so the Information was read aloud. Nolen denied past mental illness and stated that he understood the charges and consequences. Nolen expressed an intent to plead guilty but defense counsel argued that Nolen was not competent to enter a plea. The trial court entered a formal plea of not guilty and set the matter for a dispositional hearing. ¶78 The dispositional hearing was held on August 12, 2016. The defense called two witnesses to testify at this hearing. The first witness, Robert Hunt, held a master's degree in theology. He testified that Nolen's beliefs regarding Islam were not coherent and rational. The second witness for the defense was Dr. Antoinette McGarrahan, a psychologist specializing in forensic psychology and neuropsychology. Dr. McGarrahan testified that she evaluated Nolen to see if he understood the nature and consequences of entering a guilty plea. She spent nine hours with Nolen over two days during which she administered thirteen tests gauging a range of abilities from attention and concentration to cognitive control and verbal fluency. She also tested Nolen for malingering and concluded that he was not. 27 ¶79 During the time she spent with Nolen, Dr. McGarrahan noted that his thought process was rambling and incoherent. She testified that he was at times internally distracted, a sign of possible hallucinations. She found him to be delusional and out of touch with reality, displaying paranoid beliefs. Dr. McGarrahan testified that Nolen's intellectual capacity was obscured by mental illness. She concluded that Nolen suffered unspecified schizophrenia spectrum and other psychotic disorders that prevented him from having a rational understanding of the proceedings and being able to rationally comprehend and appreciate the consequences of his decision in waiving his rights. ¶80 Dr. Shawn Roberson was the State's primary expert witness at the disposition hearing. Dr. Roberson testified that in order to assess Nolen's competence as required by the court, he reviewed Dr. McGarrahan's report, transcripts of the formal arraignment, and an earlier dispositional hearing, and he re-examined Nolen at the Cleveland County Detention Center. Dr. Roberson noted that none of the tests administered by Dr. McGarrahan were relevant to assessment of mental illness; they all measured cognitive abilities. In contrast, Dr. Roberson testified that he administered the Symptoms Checklist 90-revised (SCL-90-R), a self-reported measure of psychopathology. Based upon this assessment, Dr. Roberson concluded that Nolen was not endorsing any significant psychological problems. He also disagreed with Dr. McGarrahan's conclusion that Nolen was not malingering giving far more credence to the TOMM malingering assessment. ¶81 Dr. Roberson testified that his conclusions regarding the test results were corroborated by his observations during the clinical interview. Nolen was not symptomatic and he observed nothing indicative of a thought disorder. Dr. Roberson testified that Nolen was able to engage in coherent conversation. Dr. Roberson opined that Nolen was not delusional, schizophrenic, or even necessarily malingering -- he was just not cooperating. He concluded, "I do not believe that he has any severe cognitive disability, and I do not see any mental illness. I think this is strictly personality and his volitional choice that he is uncooperative with the Court and his attorneys." ¶82 At the conclusion of the dispositional hearing, on August 17, 2016, the trial court noted that competency is a fluid issue and prior rulings are not necessarily dispositive of the current circumstance. The trial court acknowledged the presumption of competence but also that the court still had doubts. While the trial court leaned toward the conclusion that Nolen's decision not to cooperate was volitional, given the gravity of the proceeding, the trial court declined to accept Nolen's guilty plea without further inquiry. The proceeding was stayed pending a competency evaluation and a post-evaluation hearing. ¶83 The three day competency trial commenced on April 3, 2017. Several witnesses for the defense were individuals who worked at the Oklahoma Forensic Center (OFC) in Vinita in different capacities and who observed Nolen while he was there. While some testified that Nolen displayed aggressive behavior while at OFC and was medicated to reduce his aggression, several testified that Nolen displayed no signs of mental illness. Brooke Harboe, a pre-doctoral psych intern who performed the intake screen, testified that although it was not an in depth evaluation she noted that Nolen demonstrated cognitive disorganization and pervasive religious thoughts. ¶84 The first expert witness for the defense was Dr. Moira Redcorn, a psychiatrist at OFC. Dr. Redcorn testified that Nolen was at OFC for observation and evaluation, not diagnosis. While there, she interviewed Nolen and performed a psychiatric evaluation of him. She noted that he denied depression but had some symptoms. 28 He also presented symptoms of mania including distractibility, grandiose thoughts, flight of ideas, and talkativeness. Dr. Redcorn said that these were possible symptoms of mental illness, but the most prominent symptom of mental illness displayed by Nolen was disorganized speech. She noted additionally, with regard to the disorganized speech, that he could be malingering. ¶85 While Dr. Redcorn testified that the objective upon Nolen's admission to OFC was to rule out psychosis and post-traumatic stress disorder, she was unable to establish a discharge diagnosis due to his short stay and resistance to answering questions. Dr. Redcorn agreed that it was not necessary to rule out PTSD, psychosis, or any mental illness to determine competency; she stated, "You can be mentally ill and be found competent." ¶86 Dr. Antoinette McGarrahan also testified for the defense. Because Nolen would not communicate with her during her most recent attempts to evaluate him, she relied upon her prior evaluation and several other sources in reaching her conclusions. These included Cleveland County Detention Center records, OFC records including reports by Dr. Redcorn and Ms. Harboe, and reports written by Dr. Orth, a forensic psychologist with the Department of Mental Health and Substance Abuse Services who was currently the Director of Psychology at OFC. Dr. McGarrahan testified that Nolen's distractibility, flight of ideas, paranoia, grandiosity, verbal and physical aggression, agitation, and hostility were consistent with mental illness. She also ruled out malingering because Nolen did not want to be seen as mentally ill. ¶87 In answer to the seven statutory questions regarding competency, Dr. McGarrahan testified that Nolen is not able to appreciate the nature of the charges against him. Nolen, she said, does not appreciate "the charges, the basis for the charges, the consequences, the court proceedings, and what rights he would be waiving by making a plea of guilty." She testified that he does not understand the defenses available and he cannot consult with his lawyer and rationally assist in the preparation of a defense. His paranoia, hostility, and aggression, she testified, preclude him from engaging rationally with anyone, "particularly defense counsel." Dr. McGarrahan testified that Nolen is a person requiring treatment as defined by Section 1-103 of Title 43A of the Oklahoma statutes and that if treated and monitored he could attain competency. Dr. McGarrahan testified that she did not evaluate Nolen for mental retardation as it was not relevant to this proceeding. Finally, she found that Nolen was presently dangerous. Dr. McGarrahan concluded that Nolen suffers from severe mental illness that renders him incompetent. ¶88 The State responded with the testimony of two expert witnesses. Dr. Shawn Roberson testified first. He reviewed the competency evaluation reports issued by other psychologists in light of his own earlier competency evaluation. Dr. Roberson noted that defense expert Dr. Russell opined after examining Nolen that he did not have severe mental illness or meet inpatient criteria; Dr. Russell's concern was the potential of intellectual disability. Dr. Roberson testified that his conclusions were highly similar to those of Dr. Orth as neither noted signs of mental illness or cognitive impairment. ¶89 In addressing Dr. McGarrahan's report, Dr. Roberson noted that Dr. McGarrahan omitted consideration of parts of other reports that did not comport with her conclusions. For instance, Dr. McGarrahan discounted Dr. Redcorn's concern that Nolen might be malingering. She also discounted Ms. Harboe's notations that Nolen was within the average range of functioning; he appeared coherent and logical and gave appropriate responses to questions other than religion. Dr. Roberson testified that Dr. McGarrahan did not test Nolen for mental illness or psychopathology; she gave a battery of cognitive tests. Dr. Roberson noted that prior to the previous summer, there was no indication that anyone thought Nolen had severe mental illness and he disagreed with Dr. McGarrahan's diagnosis of mental illness. Dr. Roberson testified: I don't think that Alton Nolen has a severe mental illness. I don't think there is any evidence to suggest that that's accurate. I think that his behavior that [Dr. McGarrahan] interprets as being signs of mental illness is unresponsiveness, uncooperativeness; but it gets characterized as disorganization and paranoia. Pauses in responding get characterized as hallucinations. Dr. Roberson found Nolen to be competent. ¶90 The State's second expert witness was Dr. Scott Orth who testified that he performed a competency evaluation on Nolen pursuant to the court's order. During his first encounter with Nolen, Nolen did not open his eyes and said that he had already answered the questions and had nothing more to say. Nolen did, however, mention his religion; he said that he was not trying to be rude but it was against his religion to "play along" with someone who was trying to "impeach" him with "having a mental problem." Dr. Orth believed that Nolen's decision not to answer questions he believed he had already answered was a rational decision. ¶91 Dr. Orth was not able to adequately answer the court's questions based upon this initial evaluation so he looked elsewhere for information. He checked with the medical record departments of state-operated mental health facilities and found no history for Nolen. ¶92 In November of 2016, Nolen spent about two weeks at OFC for observation and evaluation. During this time, Dr. Orth was able to visit with and observe Nolen, and form an opinion regarding his competency. Nolen demonstrated a capacity to talk about the specific charges against him. He interjected religion into almost every statement but Dr. Orth did not feel this was a product of mental illness; Nolen just liked to talk about religion. Dr. Orth did not observe signs of paranoia or suspiciousness. When Dr. Orth spoke with Nolen, Nolen was calm and cordial. Dr. Orth observed no concentration or focus impairments problematic for adjudicative competence; Nolen's intellectual functioning was within the average range. Dr. Orth did not find Nolen to display disorganized or delusional thinking; his religious fixation was more akin to an overvalued belief. ¶93 Dr. Orth testified that Nolen was able to appreciate the nature of the charges against him; he suffered no major mental illness or cognitive impairment that would affect his ability to understand the charges, the plea form or the questions the court might ask. Dr. Orth also testified that Nolen was able to consult with a lawyer and rationally assist in the preparation of a defense; Nolen could do those things if he chose to do so. Dr. Orth testified that Nolen did not actually have any mental illness; any difficulty he was experiencing was the result of the way he chose to behave. Nolen, he believed, was competent. ¶94 At the close of the competency hearing, the trial court noted again the presumption of competence. The trial court stated that while the facts were not in dispute -- Nolen's behavior was bizarre and his beliefs unconventional -- conclusions drawn from the facts by the experts conflicted. The trial court noted Nolen's burden of proof to show that he was more likely than not incompetent, and the court concluded that in light of the varying testimony, the defense failed to meet their burden of proof. We do not find on this record that the trial court's ruling was an abuse of discretion. Competency to Assist in Appeal ¶95 Defense counsel asserts that Nolen is presently incompetent and cannot communicate or rationally assist in presenting his appeal to this Court. Counsel contends that while much has been accomplished without Nolen's assistance, appellate counsel has no way of knowing about information Nolen may have that could possibly assist in his appeal. Accordingly, defense counsel filed, contemporaneously with Nolen's brief in chief, an application for evidentiary hearing under Rule 3.11(A), Rules of the Oklahoma Court of Criminal Appeals, Title 22, Ch. 18, App. (2021) on the issue of his present competency. ¶96 As noted in the State's reply, it is well settled that a defendant must be competent to stand trial, enter a guilty or nolo contendre plea, or abandon his appeal. Fisher v. State, 1992 OK CR 79, ¶ 14, 845 P.2d 1272, 1276. In Fisher, we rejected the defendant's argument urging this Court to extend the requirement of present competency to appellate proceedings. Id. Accordingly, this Court held that Fisher was not entitled to an evidentiary hearing on the issue of his competency to assist in his appeal. Id. 1992 OK CR 79, ¶ 17, 845 P.2d at 1277. Nolen has neither cited authority to the contrary nor offered persuasive argument. We deny his request for an evidentiary hearing on the issue of his present competency. 3. Voir Dire -- For Cause Challenges ¶97 Nolen argues that the trial court committed reversible error when it denied defense counsel's request to remove three prospective jurors for cause. This Court has held that, "[i]n order to properly preserve for appellate review an objection to a denial of a challenge for cause, a defendant must demonstrate that he was forced over objection to keep an unacceptable juror." Eizember v. State, 2007 OK CR 29, ¶ 36, 164 P.3d 208, 220 (citing Browning v. State, 2006 OK CR 8, ¶ 8, 134 P.3d 816, 828). "This requires a defendant to excuse the challenged juror with a peremptory challenge and make a record of which remaining jurors the defendant would have excused if he had not used that peremptory challenge to cure the trial court's alleged erroneous denial of the for cause challenge." Id. Nolen preserved the issue as he used his peremptory challenges to strike the three prospective jurors he asked to remove for cause. He also advised the trial court of four other "unacceptable" prospective jurors he would have excused with peremptory challenges had he not been forced to used them on the prospective jurors that the trial court would not excuse for cause. ¶98 The decision of whether to disqualify a prospective juror for cause lies within the sound discretion of the trial court. Mitchell v. State, 2010 OK CR 14, ¶ 19, 235 P.3d 640, 647 (citing Grant v. State, 2009 OK CR 11, ¶ 24, 205 P.3d 1, 13). The trial court's decision will not be overturned absent a finding of an abuse of discretion. Id. ¶99 A critical part of the constitutional right to an impartial jury is "an adequate voir dire to identify unqualified jurors." Morgan v. Illinois, 504 U.S. 719, 729 (1992). "The purpose of voir dire examination is to discover whether there are grounds to challenge prospective jurors for cause and to permit the intelligent use of peremptory challenges." Harmon v. State, 2011 OK CR 6, ¶ 7, 248 P.3d 918, 927 (citing Sanchez v. State, 2009 OK CR 31, ¶ 44, 223 P.3d 980, 997). The United States Supreme Court has held that the proper standard for determining when a prospective juror may be excluded for cause because of his views on capital punishment is "whether the juror's views would prevent or substantially impair the performance of his duties as a juror in accordance with his instructions and his oath." Wainwright v. Witt, 469 U.S. 412, 424 (1985) (internal quotations omitted). See also Tryon v. State, 2018 OK CR 20, ¶ 28, 423 P.3d 617, 630; Jones v. State, 2009 OK CR 1, ¶ 14, 201 P.3d 869, 877. ¶100 This Court has recognized the Witt requirement that jurors be willing to consider each of the three statutory punishments: the death penalty, life imprisonment without the possibility of parole, and life imprisonment with the possibility of parole. Tryon, 2018 OK CR 20, ¶ 28, 423 P.3d at 630. See also Johnson v. State, 2012 OK CR 5, ¶ 30, 272 P.3d 720, 730 ("Due process of law requires that a prospective juror be willing to consider all the penalties provided by law and not be irrevocably committed to a particular punishment before the trial begins." (quoting Sanchez, 2009 OK CR 31, ¶ 44, 223 P.3d at 997). Further, while doubts regarding juror impartiality must be resolved in favor of the accused, this Court looks to the entirety of each potential juror's voir dire and gives deference to the ruling of the trial court because, "the trial judge is in a position to personally observe the panelists, and take into account a number of non-verbal factors that cannot be observed from a transcript." Johnson, 2012 OK CR 5, ¶ 30, 272 P.3d at 730 (citing Harmon, 2011 OK CR 6, ¶ 18, 248 P.3d at 929-30). See also Uttecht v. Brown, 551 U.S. 1, 9 (2007) ("Deference to the trial court is appropriate because it is in a position to assess the demeanor of the venire, and of the individuals who compose it, a factor of critical importance in assessing the attitude and qualifications of potential jurors."); Eizember v. Trammell, 803 F.3d 1129, 1135 (10th Cir. 2015) ("the trial judge is best positioned to determine whether a potential juror will be able to follow his or her instructions-and that a court of appeals removed from the live proceedings must afford significant deference to the trial judge's assessments"). Prospective Juror C.D. ¶101 Nolen first complains that the trial court erred in denying his request to remove prospective juror C.D. for cause because C.D. could not consider imposing either life without parole or life with the possibility of parole. Nolen notes that while C.D. initially indicated that he could consider all three sentencing options and he would not automatically impose the death penalty, C.D. indicated during defense counsel's voir dire that he would not consider a "straight life sentence." Nolen complains that C.D. was inconsistent regarding whether he could meaningfully consider a sentence of life or life without the possibility of parole. In addressing Nolen's argument, it is important to give context to C.D.'s statements during voir dire. ¶102 At the opening of the death qualifying portion of the voir dire, the trial court explained to the prospective jurors that as to the first degree murder charge, there were three punishment options. The court explained aggravating and mitigating circumstances and that "you may not consider imposing the death penalty unless you unanimously find the aggravating circumstances outweigh any mitigating circumstances which may be present." When C.D. was questioned by defense counsel, C.D. indicated he would not impose a straight life sentence in a situation where there was at least one aggravating circumstance that made the murder "really, really bad." However, the trial court asked defense counsel to approach the bench and admonished her for "setting up cause objections without providing all of the information." The court admonished counsel that inquiry about C.D.'s ability to consider mitigating circumstances should be made as well. When presented with the scenario in which the State proved at least one aggravating circumstance and the defense presented evidence of a mitigating circumstance, C.D. stated that he would consider the evidence with an open mind. C.D. stated, "So I don't take it lightly, you know, I'm open to all of those forms of punishment. If it were me on the other side, I would want everyone to treat my case the same way." ¶103 When the voir dire of C.D. is reviewed in its entirety, it does not support Nolen's argument that C.D. had a strong bias in favor of the death penalty and an inability to consider the other punishment options of life imprisonment and life without the possibility of parole. Any inconsistencies in C.D.'s responses or questions as to his ability to be a fair and impartial juror were for the trial court to resolve. Having the benefit of observing C.D.'s demeanor throughout voir dire, the court found his responses credible and insufficient to excuse him for cause. Our review of the totality of voir dire, written and oral responses, supports the trial court's finding that C.D. did not have such a strong bias towards the death penalty that the performance of his duties as juror would be prevented or substantially impaired. Accordingly, the trial court did not abuse its discretion in refusing to remove C.D. for cause. Prospective Juror A.E. ¶104 Next Nolen argues that the trial court erred in denying his request to remove prospective juror A.E. for cause because A.E. could not consider imposing a sentence of life with the possibility of parole and because she had significant media exposure before the beginning of trial. Because defense counsel requested below only that A.E. be removed for cause based upon her inability to fairly consider the sentencing option of life with the possibility of parole, Nolen's complaint on appeal that A.E. should have been removed for cause based upon her media exposure will be reviewed for plain error only. See Tryon, 2018 OK CR 20, ¶ 26, 423 P.3d at 630. ¶105 Nolen argues that A.E. should have been dismissed for cause because the media exposure caused her to question her safety during the course of the proceedings. It is true, as Nolen asserts, that A.E. stated in voir dire that she worked across the street from Vaughn Foods at the time of the incident and that she followed it on the news. However, she agreed that she could set aside what she had heard and listen to the facts. It is also true that A.E. expressed concern for her safety as a juror given the media coverage of the case. The trial court addressed this concern and assured A.E. that with the sheriff's department and the police department the court would assure the safety of the jurors. When asked about this concern by defense counsel later during general voir dire, A.E. stated that the trial court had put her concerns to rest. The record does not show A.E.'s prior media exposure or safety concerns would prevent or substantially impair the performance of her duties as a juror in accordance with her instructions and oath. There was no error, plain or otherwise, in the trial court's failure to remove A.E. for cause based upon her media exposure or safety concerns. ¶106 Next, Nolen complains that the trial court abused its discretion in declining defense counsel's request to remove A.E. for cause based upon her strong bias against the punishment option of life with the possibility of parole. During the death qualifying portion of voir dire, after A.E. stated that she could consider all three punishment options, she added that it would be hard for her to recommend life with the possibility of parole, "especially if it was decided that all of the facts were there." When questioned by the trial court, A.E. reaffirmed that she could imagine circumstances under which a sentence of life with the possibility of parole would be appropriate. After the significance of aggravating circumstances and mitigating circumstances was explained to the prospective jurors, A.E. confirmed, again, that she could leave all three punishment options on the table until after she heard all of the evidence. When, at the end of the death qualifying voir dire, defense counsel moved to strike A.E. for cause based upon her inability to fairly consider recommending a life sentence, the trial court denied this request. Based on the record, we find that the trial court's ruling was not an abuse of discretion. The record does not show A.E.'s views on the life imprisonment sentencing option would prevent or substantially impair the performance of her duties as a juror in accordance with her instructions and oath. Prospective Juror L.L. ¶107 Finally, Nolen complains that prospective juror L.L. should have been removed for cause based upon his belief that the death penalty should be automatically imposed in first degree murder cases. L.L. originally indicated in the death qualifying portion of voir dire that he could consider all three punishment options. However, Nolen notes that when questioned by defense counsel, L.L. indicated that he supports imposition of the death penalty in first degree murder cases where the killing was intentional. This belief, he argues, rendered L.L. substantially impaired and unable to fairly consider all three punishment options. ¶108 The record shows that L.L. was initially quite adamant that he could give meaningful consideration to all three punishment options. He agreed that everything was on the table and he reaffirmed more than once that he could give meaningful consideration to all three punishment options. While L.L. stated that the death penalty would be appropriate punishment for premeditated murder, he clarified, when asked by the trial court, that he could consider all three punishment options. When defense counsel requested that L.L. be removed for cause, the trial court declined, finding that L.L.'s responses did not show him to be substantially impaired; he could consider all three punishment options. The record supports the trial court's ruling and we find no abuse of discretion. This proposition is without merit and relief is not required. 4. Voir Dire Restrictions ¶109 Nolen argues that he was denied his right to select a fair and impartial jury due to restrictions placed on defense counsel's questioning of prospective jurors by the trial court. "The manner and extent of voir dire is within the discretion of the trial court whose rulings will not be disturbed on appeal absent a clear abuse of discretion." Mitchell, 2010 OK CR 14, ¶ 10, 235 P.3d at 646 (citing Eizember, 2007 OK CR 29, ¶ 67, 164 P.3d at 228). ¶110 Nolen specifically complains that defense counsel was precluded from asking prospective jurors questions designed to reveal juror bias regarding the insanity defense. The record shows that during voir dire, defense counsel asked four prospective jurors whether they believed that, "somebody can do something because of mental illness or insanity and not know what they were doing was wrong?" The first three prospective jurors answered the question affirmatively. When the question was posed to a fourth prospective juror, it was met with objection by the State on the ground that defense counsel was improperly testing the theory of defense to see if the jurors would be amenable to it. Defense counsel responded that she was not testing the theory of the case but rather inquiring to determine whether the prospective jurors could consider the defense of not guilty by reason of insanity. The trial court sustained the State's objection and Nolen complains on appeal that this ruling was in error. ¶111 The United States Supreme Court has held that, "[i]n essence, the right to jury trial guarantees to the criminally accused a fair trial by a panel of impartial, 'indifferent' jurors." Irvin v. Dowd, 366 U.S. 717, 722 (1961). See also Harmon, 2011 OK CR 6, ¶ 7, 248 P.3d at 927 ("The purpose of voir dire examination is to discover whether there are grounds to challenge prospective jurors for cause and to permit the intelligent use of peremptory challenges."). This guarantee includes the right to be tried by jurors who are capable of putting aside their personal impressions and opinions and rendering a verdict based solely on the evidence presented in court. Voir dire is a vehicle for ensuring this right, as it "serves the dual purposes of enabling the court to select an impartial jury and assisting counsel in exercising peremptory challenges." Mu'Min v. Virginia, 500 U.S. 415, 431 (1991). Thus, in voir dire, a "suitable inquiry is permissible in order to ascertain whether the juror has any bias, opinion, or prejudice that would affect or control the fair determination by him of the issues to be tried." Id. at 422 (quoting Connors v. United States, 158 U.S. 408, 413 (1895)). ¶112 However, voir dire is not without limitations. The trial court may restrict counsel from asking questions that are repetitive, irrelevant or which regard legal issues upon which the trial court will subsequently instruct the jury. Harmon, 2011 OK CR 6, ¶ 7, 248 P.3d at 927. This Court has held that while a defendant is entitled to a voir dire that fairly and adequately probes a juror's qualifications, a defendant is not necessarily entitled to test the prospective jurors on their capacity to accept his theory of the case. Robinson v. State, 2011 OK CR 15, ¶ 16, 255 P.3d 425, 431-32 ("An attorney should not use voir dire to test prospective jurors' willingness to accept a party's theory of the case, rather than the jurors' impartiality."). ¶113 In the present case, the questions asked by defense counsel regarding insanity were not designed to discern whether the prospective jurors could apply the law on the theory of the defense of insanity as their oath required but rather, whether they were open to accepting Nolen's theory of defense. In ruling on the State's objection to defense counsel's questions regarding insanity, the trial court stated, "I think you've gone far enough. I think you've put it out there. I'm going to sustain the objection. I don't know of any authority that allows you to test your -- either theory of the case, whether that's a defense or plea." As the State points out, the trial court's ruling on this particular question did not preclude defense counsel from asking questions about mental illness - which was discussed at length - or even from asking different questions about insanity; defense counsel was not precluded from asking whether prospective jurors could consider an insanity defense if they were so instructed. This single restriction on voir dire was not an abuse of discretion and did not operate to deny Nolen a fair trial by a panel of impartial jurors. This proposition is denied. 5. Admission of Gruesome Photographs ¶114 Nolen challenges the trial court's admission into evidence of four photographs he characterizes as gruesome, shocking, and disturbing. 29 Defense counsel objected to the admission of State's Exhibits 102, 104, and 108, both in a pre-trial motion in limine and again at trial. Accordingly, we review the trial court's ruling on the admissibility of these photographs for an abuse of discretion. Tryon, 2018 OK CR 20, ¶ 56, 423 P.3d at 636. Unless a clear abuse of discretion is shown reversal will not be warranted. Horn v. State, 2009 OK CR 7, ¶ 41, 204 P.3d 777, 787. Because State's Exhibit 193 was not met with objection at trial we review the admission of this photograph for plain error.30 See Williams v. State, 2008 OK CR 19, ¶ 69, 188 P.3d 208, 223. Such error must be plain and obvious and must affect the defendant's substantial rights. Lee v. State, 2018 OK CR 14, ¶ 4, 422 P.3d 782, 785. We reverse only where the error "seriously affects the fairness, integrity or public reputation of the judicial proceedings." Id. See also Hogan v. State, 2006 OK CR 19, ¶ 38, 139 P.3d 907, 923. ¶115 It is well established that gruesome crimes make for gruesome photographs. Cole v. State, 2007 OK CR 27, ¶ 29, 164 P.3d 1089, 1096. This alone will not render them inadmissible "as long as they are not so unnecessarily hideous or repulsive that jurors cannot view them impartially." Bosse v. State, 2017 OK CR 10, ¶ 48, 400 P.3d 834, 853. See also Stouffer v. State, 2006 OK CR 46, ¶ 109, 147 P.3d 245, 268. The State is "not required to downplay the violence involved or its repercussions." Tryon, 2018 OK CR 20, ¶ 63, 423 P.3d at 637 (quoting Jones, 2009 OK CR 1, ¶ 57, 201 P.3d at 885). The test for admissibility of photographs, however, is not whether they are gruesome but whether they are relevant and their probative value is not substantially outweighed by the danger of unfair prejudice or needless presentation of cumulative evidence. 12 O.S.2011, §§ 2402, 2403. Relevant evidence is defined as "evidence having any tendency to make the existence of any fact that is of consequence to the determination of the action more probable or less probable than it would be without the evidence." 12 O.S.2011, § 2401. ¶116 Nolen argues that the photographs at issue in the present case had very little relevance considering that the cause of death and identity of the perpetrator were never contested. Thus, he complains that the photographs should have been excluded because any minimal probative value they may have had was substantially outweighed by the danger of unfair prejudice -- their tendency to elicit an emotional, rather than a rational, reaction. ¶117 While the trial court did not detail the reasons for its ruling on the admissibility of photographs at trial, it did so when the issue was addressed prior to trial. The trial court reviewed the photographs with counsel, sustaining defense counsel's objection to some photographs and overruling it as to others. Where photographs were duplicative, the trial court asked the prosecutor to pick one and excluded the others. The trial court noted that State's Exhibits 102, 104, and 108, which were taken at the crime scene, were relevant because they depicted the entirety of the injuries suffered by Ms. Hufford, including defensive wounds. The trial court also noted that the photograph taken at the medical examiner's office, State's Exhibit 193, showed that the serrated knife matched injuries to Ms. Hufford's chin. ¶118 The photographs at issue were relevant as they depicted the victim and crime scene, they illustrated the nature and extent of the wounds, and they corroborated the eyewitness testimony. While gruesome, the probative value of these photographs, considered both individually and collectively, was not substantially outweighed by their prejudicial effect. The trial court did not abuse its discretion in admitting the crime scene photographs into evidence. Furthermore, the admission of the cropped photograph taken at the medical examiner's office was not error, plain or otherwise. Relief is not required. 6. Admission of Pre-Mortem Photograph ¶119 Nolen argues that the admission of a pre-mortem photograph of Colleen Hufford during first stage of trial violated his due process rights to a fundamentally fair trial and injected passion, prejudice, and other arbitrary factors into the sentencing proceedings. Because defense counsel objected to the admission of this photograph below, we review the trial court's ruling on its admissibility for an abuse of discretion. Bosse, 2017 OK CR 10, ¶ 52, 400 P.3d at 854. Again, absent a finding of a clear abuse of discretion, reversal is not warranted. Horn, 2009 OK CR 7, ¶ 41, 204 P.3d at 787. ¶120 Oklahoma law allows admission of a pre-mortem photograph to show the general appearance and condition of the victim while alive. Goode v. State, 2010 OK CR 10, ¶ 56, 236 P.3d 671, 682. Title 12 O.S.2011, § 2403 specifically provides that "in a prosecution for any criminal homicide, an appropriate photograph of the victim while alive shall be admissible evidence when offered by the district attorney to show the general appearance and condition of the victim while alive." Nolen notes that constitutional challenges to this language have been raised and addressed before and that this Court has "attempted to save this legislative act from unconstitutionality by continuing to subject such photos to balancing of prejudice versus probative value...." Indeed, this Court has rejected challenges to the constitutionality of this statutory provision and found that the statute does not afford "blanket admissibility" of such photographs because only one "appropriate" in-life photograph is allowed and that photograph is subject to the balancing test set forth in Section 2403. Hogan, 2006 OK CR 19, ¶¶ 62-64, 139 P.3d at 93-31. See also Bosse, 2017 OK CR 10, ¶¶ 52-53, 400 P.3d at 854. As in the past, Nolen's argument does not overcome the presumption that legislative acts are constitutional. See Glossip v. State, 2007 OK CR 12, ¶ 78, 157 P.3d 143, 156-57. ¶121 Nolen also claims that pre-mortem photographs have no relevance to any issue in the second stage of trial, and the introduction of the in-life photograph served no purpose other than to elicit sympathy for the victim. We rejected this claim in Malone v. State, 2007 OK CR 34, ¶¶ 85-86, 168 P.3d 185, 218-19, holding that, "in capital cases, in particular, it is constitutional to allow the sentencing jury an actual 'quick glimpse' of the person who later became the victim in the case--before he or she was reduced to the corpse shown in crime scene photographs--through the admission of an 'appropriate photograph of the victim while still alive.'" Nolen has not persuaded us to find otherwise. ¶122 The photograph admitted in the present case was an appropriate snapshot of the victim, offered to show her general appearance and condition while alive in accordance with Section 2403. The probative value of the photograph was not substantially outweighed by the danger of unfair prejudice. The trial court did not abuse its discretion in allowing this photograph into evidence and relief is not required. This proposition is without merit. 7. Constitutionality of Aggravating Circumstances ¶123 Nolen claims that three of the aggravating circumstances found by the jury failed to perform the narrowing function required by the Eighth and Fourteenth Amendments to the United States Constitution and Article II, §§ 7, 9, and 20 of the Oklahoma Constitution. He argues that the aggravating circumstances at issue were not adequately defined in jury instructions to serve the narrowing function necessary for constitutional application of the death penalty. We have repeatedly rejected these arguments. ¶124 Nolen first complains that the great risk of death to more than one person aggravating circumstance is vague and failed to perform the necessary narrowing function. This Court has addressed and rejected constitutional challenges to this aggravating circumstance in the past. Bosse, 2017 OK CR 10, ¶ 72, 400 P.3d at 859-60; Wood v. State, 2007 OK CR 17, ¶ 26, 158 P.3d 467, 477. Nolen also complains that because there is no uniform jury instruction for this aggravating circumstance, the jury was not given proper guidance on how to apply it. This Court has rejected this argument holding that, a separate uniform jury instruction defining this aggravating circumstance is not necessary. Bosse, 2017 OK CR 10, ¶ 73, 400 P.3d at 860 ("the statutory language explaining this aggravating circumstance sufficiently informs jurors what is necessary to support a finding that it is present"). See also Eizember, 2007 OK CR 29, ¶¶ 137--139, 164 P.3d at 241 (noting that the statutory language is readily understandable). We see no reason to depart from these earlier rulings. ¶125 Nolen also complains that the continuing threat aggravating circumstance is unconstitutionally vague and fails to perform the necessary narrowing function. Nolen acknowledges that this Court has repeatedly rejected attacks on this aggravating circumstance through the years. Nonetheless, he argues that in light of "recent developments in capital punishment jurisprudence" this Court should re-examine our earlier holdings. Nolen makes this argument without citation to recent authority and without reference to more recent cases wherein this Court rejected this same argument. See, e.g., Goode, 2010 OK CR 10, ¶¶ 69-72, 236 P.3d at 684-85; Sanchez, 2009 OK CR 31, ¶ 81--94, 223 P.3d at 1006--11. Nolen has presented us no compelling reason to reevaluate this aggravating circumstance at this time. ¶126 Finally, Nolen challenges the constitutionality of the especially heinous, atrocious, or cruel aggravating circumstance arguing that it is vague and fails to perform the requisite narrowing function. This Court has rejected similar challenges to the constitutionality of this aggravating circumstance. See, e.g., Harris v. State, 2019 OK CR 22, ¶ 91, 450 P.3d 933, 965; Bench v. State, 2018 OK CR 31, ¶ 112, 431 P.3d 929, 961-62; Tryon, 2018 OK CR 20, ¶ 130, 423 P.3d at 652. The analysis and authorities presented by Nolen raise nothing new. We continue to find that the heinous, atrocious or cruel aggravating circumstance is not vague and that the instructions given regarding it sufficiently narrow its application. This claim is denied. 8. Prosecutorial Misconduct ¶127 Nolen complains prosecutorial misconduct deprived him of his right to a fair trial. The alleged misconduct not met with objection at trial is reviewed for plain error only. Bivens v. State, 2018 OK CR 33, ¶ 20, 431 P.3d 985, 994. Furthermore, we also review for plain error where objection on appeal is different than the objection made below. Bench, 2018 OK CR 31, ¶ 140, 431 P.3d at 967 (when a specific objection is made at trial, this Court will not consider a different one on appeal). ¶128 On plain error review, Nolen must show that the commission of a plain or obvious error affected the outcome of his trial. Nicholson v. State, 2018 OK CR 10, ¶ 9, 421 P.3d 890, 895. "This Court will correct plain error only where it seriously affects the fairness, integrity or public reputation of the proceedings." Id. "[W]e evaluate the alleged misconduct within the context of the entire trial, considering not only the propriety of the prosecutor's actions, but also the strength of the evidence against the defendant and the corresponding arguments of defense counsel." Hanson v. State, 2009 OK CR 13, ¶ 18, 206 P.3d 1020, 1028. Eliciting Sympathy for the Victim ¶129 Nolen complains that the prosecutor elicited sympathy for the victim in both opening and closing arguments. This Court has indeed held that it is improper for the prosecutor to elicit sympathy for the victim from the jurors. Pullen v. State, 2016 OK CR 18, ¶ 14, 387 P.3d 922, 927. The single comment at issue in opening statement was not met with objection below. It occurred when the prosecutor described the victim as, "one of the most beautiful and caring ladies that you'll ever meet . . . ." This comment did not deprive Nolen of a fair trial or affect the jury's finding of guilt or assessment of punishment. There was no plain error here. ¶130 In first stage closing argument the prosecutor basically told the jury to not consider only the testimony of all the doctors, but to talk about Ms. Hufford and not forget about what happened to her. Defense counsel objected, complaining essentially that the prosecutor's argument was not relevant. As the objection on appeal is different than the objection made below, we review for plain error. Bench, 2018 OK CR 31, ¶ 140, 431 P.3d at 967. Both parties have the right to discuss the evidence from their respective standpoints and the prosecutor's comments fell within the wide range of acceptable argument. See Bland v. State, 2000 OK CR 11, ¶ 97, 4 P.3d 702, 728. The comments here were based on the evidence and not merely appeals for sympathy. The prosecutor's comments were not error, plain or otherwise. Denigrating the Defense ¶131 Nolen argues that the same comments complained of above improperly denigrated the evidence supporting the insanity defense. He did not make this objection below. Nolen reads the prosecutor's comments as an attack on the defense of insanity, but we do not. The prosecutor was arguing the facts of the case, urging the jury to consider what Nolen had done to Hufford, and this was well within his discretion. Again, both parties have the right to discuss the evidence from their respective standpoints and the prosecutor's comments fell within the wide range of acceptable argument. See id. There was no error here, plain or otherwise. Inflaming the Passions of the Jury ¶132 Finally, Nolen argues that the prosecutor unfairly inflamed the passions of the jury in closing argument when he compared the in-life photograph of the decedent with a gruesome crime scene photograph of her and stated, "Ladies and Gentlemen, he turned this into this. He turned this beautiful lady into this on the floor, this and this." This argument was not met with objection and is accordingly, reviewed only for plain error. This argument, and the use of properly admitted photographs, was a reasonable comment on the evidence. The contrasting of the two photographs did not render Nolen's trial fundamentally unfair. See Bench, 2018 OK CR 31, ¶¶ 148-50, 431 P.3d at 968-69. Relief is not required. 9. Cumulative Error ¶133 Nolen claims that even if no individual error in his case merits relief, the cumulative effect of the errors committed requires a new trial or favorable sentence modification. "The cumulative error doctrine applies when several errors occurred at the trial court level, but none alone warrants reversal." Tafolla v. State, 2019 OK CR 15, ¶ 45, 446 P.3d 1248, 1263. Although individual errors may be of insufficient gravity to warrant reversal, the combined effect of cumulative errors may require a new trial. Id. The commission of several trial errors does not deprive the defendant of a fair trial when the errors considered together do not affect the outcome of the proceeding. Id. There are no errors, considered individually or cumulatively, that merit additional relief in this case. This claim is denied. 10. Mandatory Sentence Review ¶134 Title 21 O.S.2011, § 701.13(C)(1)&(2) requires this Court to determine "[w]hether the sentence of death was imposed under the influence of passion, prejudice or any other arbitrary factor" and "[w]hether the evidence supports the jury's or judge's finding of a statutory aggravating circumstance." After conducting this review, this Court may order any corrective relief that is warranted or affirm the sentence. 21 O.S.2011, § 701.13(E). ¶135 Having reviewed the record in this case, we find that Nolen's death sentence was not the result of trial error or improper evidence or witness testimony and that the death sentence was not imposed under the influence of any arbitrary factor, passion or prejudice. ¶136 The jury's finding that Nolen (1) was previously convicted of a felony involving the use or threat of violence to the person; (2) knowingly created a great risk of death to more than one person; (3) that the murder was especially heinous, atrocious, or cruel; and (4) that there existed a probability that Nolen would commit criminal acts of violence that would constitute a continuing threat to society was amply supported by the evidence. Weighing the aggravating circumstances and evidence against the mitigating evidence presented, we find, as did the jury below, that the aggravating circumstances in this case outweigh the mitigating circumstances. DECISION ¶137 The Judgment and Sentence of the District Court is AFFIRMED. The Application for an Evidentiary Hearing on Sixth and Fourteenth Amendment Claims is DENIED. Appellee's Motion for Leave to File Amended Brief of Appellee is GRANTED and the Clerk of this Court is ORDERED to file the tendered brief. Pursuant to Rule 3.15, Rules of the Oklahoma Court of Criminal Appeals, Title 22, Ch.18, App. (2021), the MANDATE is ORDERED issued upon the delivery and filing of this decision. AN APPEAL FROM THE DISTRICT COURT OF CLEVELAND COUNTY, THE HONORABLE LORI WALKLEY, DISTRICT JUDGE APPEARANCES AT TRIAL APPEARANCES ON APPEAL MITCHELL SOLOMON SHEA SMITH BENJAMIN BROWN OKLAHOMA INDIGENT DEFENSE SYSTEM P.O. BOX 1804 NORMAN, OK 73101 ATTORNEYS FOR DEFENDANT JAMES H. LOCKARD LYDIA ANDERSON FIELDS OKLAHOMA INDIGENT DEFENSE SYSTEM P.O. BOX 926 NORMAN, OK 73070 ATTORNEYS FOR APPELLANT GREG MASHBURN DISTRICT ATTORNEY SUSAN CASWELL JOHN PEVEHOUSE ASSISTANT DISTRICT ATTORNEYS DISTRICT ATTORNEY'S OFFICE 201 SOUTH JONES NORMAN, OK 73069 ATTORNEYS FOR STATE MIKE HUNTER ATTORNEY GENERAL OF OKLAHOMA CAROLINE E.J. HUNT ASSISTANT ATTORNEY GENERAL JENNIFER L. CRABB ASSISTANT ATTORNEY GENERAL 313 N.E. 21ST STREET OKLAHOMA CITY, OK 73105 ATTORNEYS FOR APPELLEE OPINION BY: ROWLAND, V.P.J. KUEHN, P.J.: Concur LUMPKIN, J.: Concur in Results LEWIS, J.: Specially Concur HUDSON, J.: Concur FOOTNOTES 1 21 O.S.2011, § 701.12(1). 2 21 O.S.2011, § 701.12(2). 3 21 O.S.2011, § 701.12(4). 4 21 O.S.2011, § 701.12(6). 5 Nolen's statement, admitted at trial as State Exhibit #25, was written as follows: I was dealing with a batch bruschetta & the white lady (gentile) told me that i need to stir it up after i had already stirred it. I then told her it was no need for it & to tone her voice that im 30 yrs old & not one of her kids, so then she reply im a immature brat and i kind laughed about it in a way of blowin the comment off, so then 5-10 mins passed and she told the black woman on the line that i got caucassians (gentiles) fucked up. so after hering that statement i tells the black woman that i beat on caucassions (gentiles). So then she left the line. Im a Muslim & my religion come before anything! (Errors in original). 6 When 21 O.S. 701.10b was enacted in 2006 the statute used the term "mental retardation" throughout. Section 701.10b has been amended just once since its enactment. In 2019, the legislature changed the term "mental retardation" to "intellectual disability" to reflect contemporary use of terms within the medical community. Subsequently, the term "intellectual disability" has largely superseded the term "mental retardation" in both Oklahoma and federal case law. As no other amendments were made to Section 701.10b since its enactment, this opinion will cite to the amended statute and use the term "intellectual disability" instead of "mental retardation" where appropriate. 7 The record reflects that this was the only known individually administered, scientifically recognized standardized intelligence quotient test administered to Nolen by a licensed psychiatrist or psychologist. 8 The "practice effect" in neuropsychological testing occurs "whereby individuals who are tested twice in a relatively short period of time will show artificially inflated scores the second time, due to the effects of prior experience and practice with the test stimuli." United States v. Fields, 949 F.3d 1240, 1258 (10th Cir. 2019). 9 To the extent that expert witnesses relied upon information from lay persons in reaching their conclusions about Nolen's adaptive deficits, we allow consideration of lay witness testimony contradictory to the information relied upon by the expert witnesses. 10 This information conflicted with evidence that Nolen denied being in special education classes and trial testimony of other school friends who did not believe that Nolen was in special education classes. 11 Dr. Reschly agreed that Nolen's high school counselor testified that no records came from his middle school indicating that he had been in special education classes. When asked whether he gave more credence to the testimony of students than to the testimony of a school counselor, Dr. Reschly declined to answer but he agreed that the evidence was inconsistent. 12 Doug Brown, the Superintendent at Idabel Public Schools, testified that the program at Booker T. Washington attended by Nolen was not special education; part of the curriculum at Booker T. Washington included life skills but it was not necessarily for intellectually disabled students. Barbara Johnson, the current principal at Idabel High School testified that she has been at Idabel public schools for thirty-five years. She testified that when Nolen went to high school a student could not be in special education and attend the classes at Booker T. Washington; there was a different curriculum for special education students. 13 Nolen took the ACT in tenth grade and scored a 9 which, Reschly testified, was a very low score in the 1st percentile. When he took the ACT his senior year he did not fare much better scoring a 12 which is in the 4th percentile. At the time of Nolen's admission into these schools, both required applicants take the ACT but each had open admissions policies allowing students' admission regardless of their ACT scores. 14 In contrast, one of Nolan's peers, Brandon Hunter, testified that he remembered Nolen from sixth grade and high school. Hunter did not recall having any problems communicating with Nolen. In high school Hunter would pick Nolen up in the summer and they would go to a gym to work out together. They would talk about what was going on; Nolen participated in conversations. 15 Conversely, Doug Brown testified that Nolen was well liked and respected by his peers. If there was a fight or altercation in the locker room, Nolen typically tried to break it up. 16 In contrast, Crystal Brown testified that she was a hair stylist who came to know Nolen because she cut his hair. After a while, they became friends and had a close relationship for about two months. Ms. Brown testified that she had conversations with Nolen and she understood what he was saying. When she conversed with him, Ms. Brown felt like Nolen was "very straightforward, serious. I felt like he was pretty intelligent." She clarified that he was not "college-level type intelligent" but he "just knew how to get things done and take care -- take care of hisself [sic]." 17 He was, however, able to research his religious rights and communicate to human resources his desire to get time off to pray while at work. 18 That Nolen is an average reader was corroborated by Paige Nolen at trial when she testified that while Nolen did not like to read aloud and would sometimes stutter, he seemed to be an "ok" reader. 19 That Nolen was able to write and express himself coherently is also shown by State's exhibit 225, his handwritten statement about the verbal altercation he had with Traci Johnson at Vaughn Foods before he was suspended. 20 Dr. Russell testified that Nolen's skills in the area of expressive communication were "an issue" but she did not state that he had significant limitations in this adaptive skill area. 21 Dr. Russell acknowledged on cross-examination that during the administration of the FIT-R, Nolen denied having any difficulties in communicating that would interfere with his ability to talk to his lawyers or to testify in court. He specifically said that he did not want to testify. 22 Dr. Russell's testimony about her methodology in administering the tests and arriving at the IQ score was more thorough at the competency hearing than at the Atkins trial. She explained at the competency hearing that the WASI-II screening test has four subtests. Because Nolen score 62 on the WASI-II, she elected to administer the WAIS-IV full scale IQ test that included ten subtests. Because she administered the full scale IQ test only four weeks after she administered the screening test, she sought to prevent a false heightened score due to the "practice effect" by combining the two tests. She did not administer subtests in the full scale IQ test that were like those already administered in the screening test but rather used the subtests administered in the screening exam to derive the final IQ score. 23 Dr. Russell acknowledged on cross-examination that although she scored Nolen a zero in the adaptive skill area of communication, it was true that he was able to articulate a successful request for a religious accommodation at work and he also submitted an internal job application in writing outlining his prior experience to request a job change at work. Interestingly, while Dr. Russell testified at the competency hearing that Nolen suffered significant limitations in the adaptive functioning area of communications, she did not clearly opine at the Atkins trial that Nolen suffered significant limitations in this adaptive functioning area. 24 It was clarified that "mental retardation" is now called "intellectual disability" and Dr. Roberson's testimony mirrored the statutory definition in Section 701.10b. 25 While the district court's conclusions at the competency hearing regarding when the intellectual disability manifested differs from the conclusions apparently reached by the jury at the Atkins trial, the differing conclusions are of no consequence as different evidence was presented at each proceeding. 26 Many of the answers given by Nolen included the word "Alhamdulillah", which Nolen explained, means "Praise be to Allah in English." 27 Dr. McGarrahan administered two tests to measure malingering -- the DOT Counting Test and the Digit Span Subtest from the WAIS-IV. She concluded that Nolen was not malingering because he had nothing to gain by doing so; he stated that his goal was to plead guilty and be sentenced to death and he knew that he would not be able to do this if he was mentally ill. Dr. McGarrahan acknowledged on cross-examination, though, that Nolen had previously taken the TOMM, a test designed specifically to assess malingering, and had scored within a range raising concern for malingering. 28 Dr. Redcorn agreed on cross-examination that weight loss and difficulty sleeping can be indicative of something other than mental illness; these "symptoms" are "pretty typical" for people in the county jail. 29 State's Exhibits 102, 104, and 108 depicted the victim, Colleen Hufford, at the crime scene and State's Exhibit 193, taken at the medical examiner's office, showed a portion of her face and the knife used in the attack. 30 When the admissibility of State's Exhibit 193 was discussed prior to trial, defense counsel appeared not to object to its admission if the photograph were cropped. State's Exhibit 193 appears to have been cropped as per defense counsel's request as it is smaller than the other photographs admitted into evidence and defense counsel did not specifically object to the admission of this cropped photograph at trial. LUMPKIN, JUDGE: CONCUR IN RESULTS ¶1 I concur in the results reached by the Court in this case. I write to set out the proper procedure to determine if a defendant is exempt from the death penalty in accordance with the U.S. Supreme Court decision in Atkins v. Virginia, 536 U.S. 304 (2002); this Court's decision in Murphy v. State, 2002 OK CR 32, 54 P.3d 556, overruled in part by Blonner v. State, 2006 OK CR 1, 127 P.3d 1135); and the implementation of these decisions pursuant to 21 O.S.2011, § 701.10. ¶2 Throughout the implementation of the Supreme Court's determination that the Eighth Amendment to the U.S. Constitution precludes the execution of a person who is mentally retarded/intellectually disabled (MR/ID), the process is addressed in three steps. I write to set out what I consider to be the legislative history of our current statute passed to address mental retardation/intellectual disability, specifically: 1) 21 O.S.2011, § 701.10; 2) the supporting medical/legal authority addressing the nature of mental retardation/intellectual disability and the nature of proof required to show a person qualifies under its criteria; and 3) application of this criteria and proof to the current case. I. Legislative History and Origin of the Limitation to the Eighth Amendment. ¶3 In Atkins, the Supreme Court of the United States held that the Eighth Amendment's prohibition against "cruel and unusual punishment" precluded the imposition of the death penalty on a mentally retarded criminal. Atkins, 536 U.S. at 321. ¶4 In its analysis, the Supreme Court stipulated that, at Atkins' trial below, defense counsel relied on expert testimony from "a forensic psychologist who had evaluated Atkins before trial and concluded that he was 'mildly mentally retarded.'"1 Atkins, 536 U.S. at 308. The expert's "conclusion was based on interviews with people who knew Atkins, a review of school and court records, and the administration of a standard intelligence test which indicated that Atkins had a full scale IQ of 59."2 Id. at 308-09. Quoting Stedmans Medical Dictionary, the Supreme Court defined mental retardation3 as "requir[ing] not only subaverage intellectual functioning, but also significant limitations in adaptive skills such as communication, self-care, and self-direction that became manifest before age 18." Atkins, 536 U.S. at 318. ¶5 However, rather than set out a uniform test for determining the mental status of criminal defendants, the Court, noting both the "serious disagreement about the execution of mentally retarded offenders" and the fact that "[n]ot all people who claim to be mentally retarded . . . will fall within the range of mentally retarded offenders," left to the "State[s] the task of developing appropriate ways to enforce the constitutional restriction." Id. at 317. ¶6 As we noted in Murphy, the Oklahoma Legislature had attempted to address the issue of mental retardation, but the Governor at the time had precluded the passage of that legislation. Due to that failure to act, and in light of Atkins, this Court was forced to act. Accordingly, we adopted the following definition for mental retardation in Murphy to apply to defendants, in capital cases, alleging they are not eligible to be sentenced to the death penalty: A person is "mentally retarded": (1) If he or she functions at a significantly sub-average intellectual level that substantially limits his or her ability to understand and process information, to communicate, to learn from experience or mistakes, to engage in logical reasoning, to control impulses, and to understand the reactions of others; (2) The mental retardation manifested itself before the age of eighteen (18); and (3) The mental retardation is accompanied by significant limitations in adaptive functioning in at least two of the following skill areas: communication; self-care; social/interpersonal skills; home living; self-direction; academics; health and safety; use of community resources; and work. It is the defendant's burden to prove he or she is mentally retarded by a preponderance of the evidence at trial. Intelligence quotients are one of the many factors that may be considered, but are not alone determinative. However, no person shall be eligible to be considered mentally retarded unless he or she has an intelligence quotient of seventy or below, as reflected by at least one scientifically recognized, scientifically approved, and contemporary intelligent quotient test. This standard shall be used at all future and pending capital trials, until such time as it may be replaced by a suitable legislative enactment. Murphy, 2002 OK CR 32, ¶ 31, 54 P.3d at 567-68. ¶7 Subsequent to the publication of Murphy, the language above was codified by the Legislature in 21 O.S.2011, § 701.10b. Therefore, this guidance must also be considered as a part of the legislative history which goes to the interpretation of § 701.10b. ¶8 I agree with Judge Rowland that we are to apply the plain language of the statute in this case. However, the interpretation of statutes is always to ensure the application of the legislature's intent in the statute. In Oklahoma, finding legislative history to determine that intent is extremely rare. However, in this case, we do know the legislature's intent, and that is to comply with the Supreme Court's decision in Atkins and the codifying of our decision in Murphy. In that regard, we first look to what evidence the Supreme Court used to form their opinion as set out above. ¶9 As a result, I view the statute requires a defendant to put forth, by a preponderance of the evidence, that: 1) he or she has a subaverage intelligence level of 70 or below applying the standard deviation; 2) it was manifested before age 18; and 3) if those criteria are met, then he/she must also show adaptive functioning limitations in at least two (2) of the above listed areas of life. II. Analysis of the Limited Application of the Exemption due to the Extremely Rare Occurrence of Mental Retardation/Intellectual Disability in the Population as a Whole, Including both Legal and Medical Evidence to Prove a Person is Mentally Retarded/Intellectually Disabled. ¶10 Approximately 6.5 million people, or less than 2% of the population, in the United States have an intellectual disability. See Measuring Mental Retardation; IQ tests, Social Security Disability Law & Procedure in Federal Court § 5:42 ("only 2% of the general population scores 69 or below"). The causes of MR/ID in that approximated 2% of the population can be broken down into three subcategories: prenatal, perinatal, and postnatal causes. Of these three causes, prenatal causes (such as genetic syndromes, brain malformations, or environmental influences) are the most common, and postnatal causes (such as traumatic brain damage, infection, or severe malnutrition) are the rarest. Genetic causes alone account for 30% to 50% of all intellectual disability cases. Other research yields data that some 25% to 40% of MR/ID causes are unknown. While the precise statistical breakdown of the pre-, peri-, and postnatal causes of this 2% has proved evasive in my research efforts, it is evident that the cases of postnatal causes of ID are few and far between. ¶11 The following chart lays out the stages at which mental retardation can be identified and the causes so identified by the medical community. Prenatal Environmental factors -Deficiencies , such as iodine deficiency and folic acid deficiency -Severe malnutrition in pregnancy-Rh incompatibility -Using substances such as alcohol (maternal alcohol syndrome), nicotine, and cocaine during early pregnancy -Exposure to other harmful chemicals such as pollutants, heavy metals, and harmful medications such as thalidomide, phenytoin and warfarin sodium in early pregnancy -Maternal infections such as rubella, syphilis, toxoplasmosis, cytomegalovirus and HIV -Others such as excessive exposure to radiation Chromosomal abnormalities(cytogenetic techniques) Trisomy 21 Partial trisomies (e.g., 4p, 9q) Aneusomies of the X chromosome Partial deletions (eg, 5p-/cri de chat) Translocations Cryptic chromosomal abnormalities(complex methods) -Microdeletions or microduplications of chromosomal segments Wolf-Hirschhorn syndrome Pallister-Killian syndrome 18p deletion -Cryptic subtelomeric rearrangements (eg, deletions, duplications) -Cryptic interstitial rearrangements - microdeletion : a-thalassemia with mental retardation ,Smith Magenis syndrome (deletie 17p11.2.) , Rubinstein-Taybi syndrome (16p13.3) -Cryptic interstitial rearrangements - duplications: 15q11-13 duplication: Kabuki Makeup syndrome -Contigous gene syndrome Mutation of a single gene X-linked mental retardation Mowat-Wilson syndrome Cornelia de Lange syndrome Lissencephaly with cerebellar hypoplasia Walker--Warburg syndrome (also known as HARD syndrome) Muscle--eye--brain disease (MEB) Fukuyama congenital muscular dystrophy (FCMD) with type 2 lissencephaly Neurofibromatosis type 1 (NF1); Cerebral malformations Perinatal 3rdtrimester Complications of pregnancy Diseases in mother such as heart and kidney disease and diabetes Placental dysfunction During delivery Severe prematurity, very low birth weight, birth asphyxia Difficult and/or complicated delivery Birth trauma, vascular accidents Neonatal Septicemia, severe jaundice, hypoglycemia Postnatal (in infancy and childhood) Traumatic, accidental, infectious Brain infections such as tuberculosis, encephalitis, and bacterial meningitis Head injury Chronic lead exposure Severe and prolonged malnutrition Gross under stimulation MR that develops after a period of normal development Lysosomal storage diseases Peroxizomal disorders Exposure to heavy metals, pesticide, malnutrition Multifactorial or complex inheritance MR Maria Puiu et.al., The Genetics of Mental Retardation, Genetic Disorders (Jan. 9, 2013), (https://www.intechopen.com/books/genetic-disorders/the-genetics-of-mental-retardation). ¶12 James W. Ellis et. al. set out the following in their Hofstra Law Review article, "Evaluating Intellectual Disability: Clinical Assessments in Atkins Cases," to wit: The final component of the definition of intellectual disability is the stipulation that the disability must have originated during the developmental period of life. This requirement has proven to present the fewest issues for diagnosticians in Atkins cases, and few cases have turned on this prong. The vast majority of people with the level of intellectual impairment to satisfy the first prong of the definition--and the deficits in adaptive behavior to satisfy the second prong-- first experienced their disability in childhood, and for some, the cause can be traced back to their birth or their genetic make-up. The only individuals who are excluded from the category by the age of onset requirement are individuals whose disability can be traced to events during adulthood. Examples would include individuals whose neurocognitive impairments occurred post-adolescence as with dementia, or brain injuries due to post-adolescence accidents. But for diagnostic purposes, adult-onset impairments can be identified and distinguished from intellectual disability. The only major point of confusion about the age of onset requirement in Atkins cases appears to involve the definition's requirement that the disability must have "originated" or "manifested" during the developmental period of life. The definition does not require that there have been IQ tests or formal assessments of adaptive deficits while the individual was a child. Whether a person had received such testing or diagnostic services as a child is, of course, a matter of happenstance, with no relevance to questions of culpability. Educational policy choices, even routine bureaucratic decisions, may play a part in determining whether a child is tested and properly diagnosed as having intellectual disability. If a defendant currently meets the [other] two criteria[ 4], and there are indications of impairment, delayed development, etc., from childhood, and if there is no indication that the impairment resulted from causes that occurred in adulthood, a diagnosis of intellectual disability is appropriate, and constitutionally compelled. James W. Ellis et. al., Evaluating Intellectual Disability: Clinical Assessments in Atkins Cases, 46 Hofstra L. Rev. 1305, 1336--39 (2018) (footnotes omitted). III. Application of Legal and Medical Requirements to the Evidence in this Case. ¶13 Turning now to the facts in this case, I apply the law and medical criteria set out above. First, Appellant does have an IQ test that shows his current IQ is 69, albeit, this test was conducted some two years after the crime and its validity is questionable due to the manner in which it was administered. The question of the test validity goes to the weight and credibility the jury may have given it. ¶14 Second, there is no evidence that whatever Appellant's intelligence level might be, it was manifested before age 18. No intellectual functioning tests were administered before age 18. This fact requires us to look at other evidence, as described above, to indicate the onset of his level of functioning was manifest before age 18. ¶15 Appellant progressed through his public education without being placed in any special education programs. While he was assigned to the alternative school at one point, the evidence does not indicate it was due to any intellectual disability. His grades over this span, while up and down at times, do not reveal any consistent intellectual problems. His sister testified Appellant could read and did so often; however, he did not like to read out loud. The record is void of any evidence that he was the victim of any accident that could be attributed as a cause of any intellectual disability. Thus, this record lacks an evidentiary base to establish whatever Appellant's intellectual status is, it did not manifest itself before age 18. ¶16 This failure to establish any intellectual disability prior to age 18 answers the question of whether Appellant qualifies as mentally retarded/intellectually disabled under Atkins and is exempt from the death penalty. In Atkins, the Supreme Court recognized that not all individuals with a sub-average intelligence will qualify for the exemption. This is so when each of the three requirements cannot be met. Each is separate and distinct, but build on one another to determine at the end if a defendant is or is not eligible for the death penalty under the Eighth Amendment. As set out in Part II, above, there are ways to put forth evidence, even without an IQ test, that a person is suffering from mental retardation/intellectually disability which existed and was manifest before age 18. However, Appellant in this case has failed to do so. ¶17 Third, even if this Court examined the record to determine if Appellant has proved significant limitations, in at least two areas of adaptive functioning he fails. Appellant graduated from high school and attended college. He even received an A grade in a college psychology course. He was gainfully employed, having held the job at Vaughn Foods for over a year before the commission of the crimes in this case. Appellant lived independently, drove a car, participated in personal socializing by going to the mosque, and used technology. ¶18 In summary, I find Appellant has failed to show by a preponderance of the evidence that he is mentally retarded/intellectually disabled as required under Atkins and 21 O.S. § 701.10. Under the law and the evidence, he is eligible for the death penalty and the evidence is sufficient to affirm the verdicts and sentences rendered by the jury and the District Court of Cleveland County. IV. Conclusion ¶19 It is for the above reasons that I believe the qualification for exemption from the death penalty due to mental retardation/intellectual disability is a three-step process: (1) sub-average intellectual functioning; (2) manifested before the age 18 (as set out above); and (3) is additionally accompanied by significant limitations in two or more adaptive functions as set out in § 701.10b. As the Supreme Court referenced in the cited materials in Atkins, as well as this Court's analysis in Murphy and Fuston v. State, 2020 OK CR 4, ¶¶ 15-38, 470 P.3d 306, 315-318, the establishment of the first prong of sub-average intellectual functioning is separate and apart from the third prong of significant limitations in two or more adaptive functions. Therefore, if a defendant cannot establish the first prong of sub-average intellectual functioning, then there is no need to move onto the third prong of significant limitations in two or more adaptive functions. While each of the three prongs work together to ultimately decide the issue of whether Eighth Amendment MR/ID has been established, one prong alone does not define the other. We should be consistent with this Court's interpretation of Atkins, Murphy, and Fuston. FOOTNOTES 1 The American Association on Mental Retardation (AAMR) defines mental retardation as follows: "Mental retardation refers to substantial limitations in present functioning. It is characterized by significantly subaverage intellectual functioning, existing concurrently with related limitations in two or more of the following applicable adaptive skill areas: communication, self-care, home living, social skills, community use, self-direction, health and safety, functional academics, leisure, and work. Mental retardation manifests before age 18." Mental Retardation: Definition, Classification, and Systems of Supports 5 (9th ed.1992). The American Psychiatric Association's definition is similar: "The essential feature of Mental Retardation is significantly subaverage general intellectual functioning (Criterion A) that is accompanied by significant limitations in adaptive functioning in at least two of the following skill areas: communication, self-care, home living, social/interpersonal skills, use of community resources, self-direction, functional academic skills, work, leisure, health, and safety (Criterion B). The onset must occur before age 18 years (Criterion C). Mental Retardation has many different etiologies and may be seen as a final common pathway of various pathological processes that affect the functioning of the central nervous system." Diagnostic and Statistical Manual of Mental Disorders 41 (4th ed.2000). "Mild" mental retardation is typically used to describe people with an IQ level of 50--55 to approximately 70. Atkins, 536 U.S. at 309 n.3 (internal citations omitted). 2 At the sentencing phase, Dr. Nelson testified: "[Atkins'] full scale IQ is 59. Compared to the population at large, that means less than one percentile.... Mental retardation is a relatively rare thing. It's about one percent of the population." According to Dr. Nelson, Atkins' IQ score "would automatically qualify for Social Security disability income." Dr. Nelson also indicated that of the over 40 capital defendants that he had evaluated, Atkins was only the second individual who met the criteria for mental retardation. He testified that, in his opinion, Atkins' limited intellect had been a consistent feature throughout his life, and that his IQ score of 59 is not an "aberration, malingered result, or invalid test score." Atkins, 536 U.S. 309 n.5 (internal citations omitted). 3 Stedmans Medical Dictionary 777730: "[S]ubaverage general intellectual functioning that originates during the developmental period and is associated with impairment in adaptive behavior. The American Association on Mental Deficiency lists eight medical classifications and five psychological classifications; the latter five replace the three former classifications of moron, imbecile, and idiot. Mental retardation classification requires assignment of an index for performance relative to a person's peers on two interrelated criteria: measured intelligence (IQ) and overall socioadaptive behavior (a judgmental rating of the person's relative level of performance in school, at work, at home, and in the community). In general an IQ of 70 or less indicates mental retardation (mild = 50/55--70; moderate = 35/40--50/55; severe = 20/25--35/40; profound = below 20/25); an IQ of 70--85 signifies borderline intellectual functioning." 4 As laid out in 21 O.S.2011, § 701.10b(C), the other two criteria that the defendant must meet are (1) intellectual disability by showing significantly subaverage general intellectual functioning (i.e. an IQ score of 70 or below on an individually administered, scientifically recognized standardized intelligence quotient test administered by a licensed psychiatrist or psychologist) and (2) significant limitations in adaptive functioning. LEWIS, JUDGE, SPECIALLY CONCURRING: ¶1 I concur in the denial of relief, and write separately on the proper limitations of voir dire. A trial court may properly exercise its discretion to limit voir dire into specific factual hypotheticals about a party's theory of defense. Black v. State, 2001 OK CR 5, ¶ 19, 21 P.3d 1047, 1058 (limiting voir dire concerning hypotheticals grounded in facts of the case). ¶2 However, in cases of this gravity, the court should permit a generalized inquiry about prospective jurors' opinions, conceptions, beliefs, or potential biases about a legal or factual defense having likely application to the case. Such inquiry provides information relevant to potential challenges for cause and intelligent use of peremptories. ¶3 The court need not indulge an inquisition, and may direct counsel to come to the point, but it should not arbitrarily cut-off voir dire about a legal or factual defense. A few thoughtful questions may show a juror is either too biased to serve in the case or should be removed by peremptory challenge. Citationizer© Summary of Documents Citing This Document Cite Name Level None Found. Citationizer: Table of Authority Cite Name Level Oklahoma Court of Criminal Appeals Cases  CiteNameLevel  1992 OK CR 79, 845 P.2d 1272, FISHER v. STATEDiscussed at Length  2001 OK CR 5, 21 P.3d 1047, 72 OBJ 858, BLACK v. STATEDiscussed  2002 OK CR 32, 54 P.3d 556, MURPHY v. STATEDiscussed at Length  2005 OK CR 26, 126 P.3d 646, LAMBERT v. STATEDiscussed  2006 OK CR 1, 127 P.3d 1135, BLONNER v. STATEDiscussed  2006 OK CR 8, 134 P.3d 816, BROWNING v. STATEDiscussed  2006 OK CR 19, 139 P.3d 907, HOGAN v. STATEDiscussed at Length  2006 OK CR 28, 138 P.3d 549, HOWELL v. STATEDiscussed  2006 OK CR 46, 147 P.3d 245, STOUFFER v. STATEDiscussed  2007 OK CR 12, 157 P.3d 143, GLOSSIP v. STATEDiscussed  2007 OK CR 17, 158 P.3d 467, WOOD v. STATEDiscussed  2007 OK CR 27, 164 P.3d 1089, COLE v. STATEDiscussed  2007 OK CR 29, 164 P.3d 208, EIZEMBER v. STATEDiscussed at Length  2007 OK CR 34, 168 P.3d 185, MALONE v. STATEDiscussed  2008 OK CR 19, 188 P.3d 208, WILLIAMS v. STATEDiscussed  2009 OK CR 1, 201 P.3d 869, JONES v. STATEDiscussed at Length  2009 OK CR 7, 204 P.3d 777, HORN v. STATEDiscussed at Length  2009 OK CR 11, 205 P.3d 1, GRANT v. STATEDiscussed at Length  2009 OK CR 13, 206 P.3d 1020, HANSON v. STATEDiscussed  2009 OK CR 31, 223 P.3d 980, SANCHEZ v. STATEDiscussed at Length  2010 OK CR 10, 236 P.3d 671, GOODE v. STATEDiscussed at Length  2010 OK CR 14, 235 P.3d 640, MITCHELL v. STATEDiscussed at Length  2011 OK CR 6, 248 P.3d 918, HARMON v. STATEDiscussed at Length  2011 OK CR 15, 255 P.3d 425, ROBINSON v. STATEDiscussed  2012 OK CR 3, 269 P.3d 949, STATE v. HOOLEYDiscussed  2012 OK CR 5, 272 P.3d 720, JOHNSON v. STATEDiscussed at Length  2016 OK CR 18, 387 P.3d 922, PULLEN v. STATEDiscussed  2017 OK CR 10, 400 P.3d 834, BOSSE v. STATEDiscussed at Length  2018 OK CR 10, 421 P.3d 890, NICHOLSON v. STATEDiscussed  2018 OK CR 14, 422 P.3d 782, LEE v. STATEDiscussed  2018 OK CR 20, 423 P.3d 617, TRYON v. STATEDiscussed at Length  2018 OK CR 31, 431 P.3d 929, BENCH v. STATEDiscussed at Length  2018 OK CR 33, 431 P.3d 985, BIVENS v. STATEDiscussed  2019 OK CR 15, 446 P.3d 1248, TAFOLLA v. STATEDiscussed  2019 OK CR 22, 450 P.3d 933, HARRIS v. STATEDiscussed  2020 OK CR 4, 470 P.3d 306, FUSTON v. STATEDiscussed  2000 OK CR 11, 4 P.3d 702, 71 OBJ 1304, Bland v. StateDiscussed Title 12. Civil Procedure  CiteNameLevel  12 O.S. 2401, Relevant Evidence DefinedCited  12 O.S. 2402, Relevant Evidence Generally Admissible - Irrelevant Evidence InadmissibleCited  12 O.S. 2403, Exclusion of Relevant Evidence on Grounds of Prejudice, Confusion or Cumulative Nature of EvidenceCited Title 21. Crimes and Punishments  CiteNameLevel  21 O.S. 701.10b, Intellectual Disability - Death Penalty - Burden - Notice - Evidentiary Hearing - Standard of Review - InstructionsDiscussed at Length  21 O.S. 645, Assault, Battery, or Assault and Battery with Dangerous WeaponCited  21 O.S. 652, Shooting with Intent to Kill - Assault and Battery with Deadly Weapon, etc.Cited  21 O.S. 701.7, Murder in the First DegreeCited  21 O.S. 701.10, Sentencing Proceedings for First Degree Murder - State Seeking Death PenaltyDiscussed at Length  21 O.S. 701.12, Aggravating CircumstancesDiscussed at Length  21 O.S. 701.13, Review of Death Penalty SentenceDiscussed Title 22. Criminal Procedure  CiteNameLevel  22 O.S. 1175.1, DefinitionsCited  22 O.S. 1175.3, Hearing - Date - Evidence - Orders - Examination of Accused - Instructions to PhysicianCited  22 O.S. 1175.4, Post-examination Competency Hearing - Evidence - Presumptions - Jury Trial - Presence of Accused - Witnesses - InstructionsCited

2012-04-17 06:25:01+00

http://bulk.resource.org/courts.gov/c/F3/71/71.F3d.882.94-6855.html

71 F.3d 882 Gentry v. United Parcel Service** NO. 94-6855 United States Court of Appeals, Eleventh Circuit. Nov 13, 1995 1 Appeal From: N.D.Ala., No. 91-01739-CV-B-S 2 AFFIRMED. ** Local Rule 36 case

2020-12-02 00:02:08.508437+00

https://www.courts.ca.gov/opinions/nonpub/G058278.PDF

Filed 12/1/20 Singh v. Gordon CA4/3 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 THREE SIMERJEET SINGH, Plaintiff and Appellant, G058278 v. (Super. Ct. No. 30-2019-01058049) STEVE GORDON, as Director, etc., OPINION Defendant and Respondent. Appeal from a judgment of the Superior Court of Orange County, Derek W. Hunt, Judge. Affirmed. Rodney Gould for Plaintiff and Appellant. Xavier Becerra, Attorney General, Chris A. Knudsen, Assistant Attorney General, Gary S. Balekjian and Catherine E. Wise Deputy Attorneys General, for Defendant and Respondent. * * *  Plaintiff Simerjeet Singh had his driver’s license suspended after being arrested for driving under the influence (DUI) and refusing to consent to a chemical test. Under Vehicle Code section 13353, revocation of his license was automatic upon refusal. After the Department of Motor Vehicles (DMV) upheld the license suspension at an administrative hearing, Singh petitioned the trial court for a writ of mandate, arguing the police officer’s recitation of his Miranda rights confused him about his obligation to 1 consent to a chemical test, which nullified his refusal. The trial court denied the petition. Singh appeals, contending substantial evidence does not support the court’s conclusion. We affirm. The evidence supports a conclusion that police officers clearly explained Singh’s rights and obligations. Singh simply did not believe them. As an employee at the Orange County District Attorney’s Office, he knew just enough about the law to be dangerous, believing that he could insist on a search warrant before agreeing to a chemical test. He was wrong. His license was properly revoked. STATEMENT OF FACTS At approximately 9:40 p.m., on February 2, 2018, Singh was driving his vehicle on El Camino Real Boulevard in the City of Tustin, when he ran his car into a pillar, then proceeded to strike a parked car. A witness saw Singh exit his vehicle and stumble into the restroom of a nearby restaurant. The witness followed Singh and observed him vomiting on the ground. Afterward, Singh was transported by ambulance to a local hospital. Officer Swart of the Tustin Police Department followed Singh to the hospital, where he observed Singh to have bloodshot, watery eyes, a strong smell of alcohol, and slurred speech. At the hospital, Singh was uncooperative and, in the administrative hearing officer’s words, 1 Miranda v. Arizona (1966) 384 U.S. 436 . 2 “obstreperous[,] avoiding even the physician’s questions regarding what had happened, and the driver’s own health.” At the hospital, Officer Swart asked Singh if he would be willing to take a blood-alcohol test, either by breath or blood draw. Singh refused, stating he would only take one if Officer Swart obtained a warrant. Officer Swart explained that Singh had agreed to take a chemical test when he obtained his California Driver’s License and that refusal to take a test could result in his license being automatically suspended, but Singh did not budge. After Singh was discharged, at approximately 11:15 p.m., Officer Swart arrested him for DUI and transported him to the Tustin Police Department. Officer Swart read Singh his Miranda rights at the station. After the Miranda rights were read, Officer Swart turned on his body camera to record the remainder of the interview. At that point, another officer, Officer Dao, who was in charge of drafting the report on the traffic collision, approached Singh to ascertain what happened. After confirming with Officer Swart that he had read Singh his Miranda rights, Officer Dao began questioning Singh, but Singh exercised his right to remain silent, stating, “If I have my Miranda rights, I’d like to use them.” Shortly afterward, Officer Swart explained to Singh that because he refused to consent to a breath or blood test, Officer Swart was filling out an application for a search warrant. This was apparently Officer Swart’s first time performing a DUI arrest, so he brought in another officer, Officer Babb, to help. Officer Babb began by stating to Singh, “When we have to do a search warrant, and you basically refuse to provide a sample of your blood or your breath, your license automatically gets suspended for a year.” Singh replied, “I’m not refusing, I’m just saying, you know, hey, give me a warrant, and I’ll totally comply.” Officer Babb reiterated that if he does not willingly provide a sample, his license would automatically be suspended, and, to emphasize the point, Officer Swart chimed in, “me . . . filling out this search warrant for your blood, that’s going to take away your license.” Officer Babb 3 drove the point home: “and there is nothing you can do about that.” Officer Swart went on, “You’re under the impression we need a search warrant, but you waived that right when you signed for your California Driver’s License.” Singh, unpersuaded, asked, “Can I see that? Can I look that up?” “If you show me that, hey, go ahead, take my breathalyzer right now.” Officer Swart replied that right now he is filling out the application for the warrant, and if he does that, “your license is going to get taken away.” (Italics represent the emphasis in Officer Swart’s voice.) Singh replied, “I understand that. But . . . you show me that rule, I’ll go for it right now. Because I know, legally, you’re allowed to lie to me.” While Officer Swart continued filling out the search warrant application, Officer Babb, to his credit, found the relevant statute and showed it to Singh. He read Vehicle Code section 13353, which states, “(a) If a person refuses the officer's request to submit to, or fails to complete, a chemical test or tests pursuant to Section 23612, upon receipt of the officer’s sworn statement that the officer had reasonable cause to believe the person had been driving a motor vehicle in violation of Section 23140, 23152, or 23153, and that the person had refused to submit to, or did not complete, the test or tests after being requested by the officer, the department shall do one of the following: (1) Suspend the person’s privilege to operate a motor vehicle for a period of one year.” The other options involve either a two- or three-year suspension under certain circumstances. Singh’s bluff was called. He did not submit to a test, as promised, but instead replied, “I have not received any sworn statement.” That response was a misinterpretation of Vehicle Code section 13353—the sworn statement goes to the DMV, not the driver. Singh went on, “I’m not trying to be a hard ass . . . . I’m just saying, hey, I have some rights, I’m going to use them.” Afterward, now at about 25 minutes into the questioning, the officers read a standard admonition concerning Singh’s obligation to submit to a breath or blood test. Midway through the admonition, Singh interjected, “I would like an attorney present, 4 sir.” The admonition continued, eventually reaching the following statement, “You do not have the right to talk to an attorney or have an attorney present before stating whether you will submit to a test or before deciding which test to take or during the test.” The admonition concluded with the following questions: “Will you take a breath test?” Singh replied, “not at this point, sir, I would like an attorney present.” “Will you take a blood test?” Singh replied, “Not at this point sir, if I don’t have to. Unless you have a search warrant, I will happily take that.” Officer Swart continued filling out the application for a search warrant. When Singh was told that Officer Swart would need to speak with the Orange County District Attorney’s Office, he informed the officers that he works there. One of the officers asked, “Are you an attorney?” Singh replied, “I’m trying to be, I work at the DA’s office. That’s exactly where I came from.” A warrant was eventually obtained and Singh’s blood was drawn, but the process took a while—the accident occurred at approximately 9:40 p.m.; the blood draw occurred at 2:39 a.m. the next morning. Even still, Singh’s blood alcohol content was .089 percent. At around the same time, Officer Swart served Singh with an administrative per se order of suspension/revocation of driving privileges. He filed a sworn statement with the DMV as required by Vehicle Code section 13353. Singh requested an administrative hearing, which was granted. After the administrative hearing, where Singh testified, the hearing officer determined there was reasonable cause to believe Singh was driving under the influence, he was lawfully arrested, he was informed that his license would be revoked if he refused testing, and he refused testing anyway. The hearing officer rejected Singh’s argument that the Miranda warnings led Singh to be confused about his rights. Singh then filed a petition for a writ of mandate in the trial court. The court denied the petition without elaboration. Singh timely appealed. 5  DISCUSSION On appeal, Singh renews his contention that the police officers confused him about his obligation to provide a chemical test by first reading him his Miranda rights. While it is certainly true that the reading of Miranda rights can confuse a driver and thereby avoid the consequences of refusing to take a chemical test (McDonnell v. Department of Motor Vehicles (1975) 45 Cal.App.3d 653 , 658), the snag for Singh is that whether he was confused by the Miranda warnings is a factual question. We review factual questions for substantial evidence. (Garcia v. Department of Motor Vehicles (2010) 185 Cal.App.4th 73 , 82.) That means Singh could only win on appeal if the evidence compelled the conclusion that he was confused by the Miranda warnings. The evidence here does not so compel. A plausible interpretation of the evidence is that Singh misunderstood his rights based on his own independent beliefs about the law and refused to believe anything the police told him. This interpretation is supported by the fact that he worked at the Orange County District Attorney’s Office, as well as the self-assured way in which he asserted his rights. Moreover, his continued insistence that the police obtain a warrant is not likely to have come from a Miranda warning, which does not typically mention anything about warrants. Finally, Singh explicitly said the police could lie to him, and it was clear he simply did not believe anything they were going to tell him. Singh’s position is that anytime Miranda warnings have been given, it is not enough to explain to a driver that he faces confiscation of his license if he refuses a test, and that he does not have a right to an attorney at that stage. The officer must take the additional step of explicitly saying that Miranda rights do not apply. But given Singh’s refusal to believe anything the police officers told him, what difference would that have made? There is nothing magical about the word “Miranda.” If Singh did not 6 believe the police when they told him what his actual rights consisted of, couching those rights in terms of Miranda would not have changed anything. Throughout these proceedings, Singh has relied heavily on Hoberman- Kelly v. Valverde (2013) 213 Cal.App.4th 626 (Hoberman-Kelly), a case which, in our view, only serves to highlight the shortcomings in Singh’s argument. There, a driver was arrested for DUI and, seeing a sign at the police station advising her of her right to a phone call, insisted on calling her attorney. (Id. at p. 629.) The officer “at no point acknowledged her request to make a call, responded to her question why she could not do so as the sign indicated, or made any effort to explain that despite her right to speak to an attorney she was not entitled to do so or to make her call before submitting to the test.” (Ibid.) The officer proceeded to read the driver the standard testing admonition, including that she was not entitled to an attorney. “However, from the video it is apparent that [the driver], who was voicing her demands while [the officer] was reading the statement, did not hear the admonition and that [the officer] must have been aware that she did not hear it.” (Ibid.) “When [the officer] finished reading the admonition, he asked [the driver] whether she would submit to a blood test, to which she responded ‘all right,’ but [the officer] stated ‘that’s a no’ and that he would take it as a refusal.” (Ibid.) The DMV suspended her license. The driver petitioned for a writ of mandate, which the trial court granted. (Hoberman-Kelly, supra, 213 Cal.App.4th at p. 630.) The DMV appealed. (Id. at p. 631.) Notwithstanding the evidence above, the court commented, “It is questionable whether officer-induced confusion would provide a defense here if [the driver] had refused to take a blood test.” (Id. at p. 632.) That point was immaterial, however, because the court found substantial evidence supported the trial court’s conclusion that the driver never actually refused a test. (Id. at p. 633.) The differences between Hoberman-Kelly and our case are readily apparent. Here, Singh did, in fact, refuse to take a blood or breath test. Singh clearly 7 heard and understood the admonition that he was not entitled to an attorney before taking a test. The officers made a substantial effort to explain Singh’s rights, including taking the unusual step of looking up the relevant statute and reading it to Singh. Lastly, and most importantly, the standard of review here is flipped: In Hoberman-Kelly the court resolved all conflicts and inferences in favor of the driver; here we must resolve the same in favor of the DMV. Hoberman-Kelly is inapposite. Ultimately, the question here is simply whether the evidence supports the trial court’s conclusion that Singh’s refusal was not a product of officer-induced confusion. It does. DISPOSITION The judgment is affirmed. Respondent shall recover its costs incurred on appeal. IKOLA, J. WE CONCUR: MOORE, ACTING P. J. GOETHALS, J. 8

2020-12-02 00:02:09.857429+00

https://www.courts.ca.gov/opinions/nonpub/F077587.PDF

Filed 12/1/20 P. v. Wiley CA5 NOT TO BE PUBLISHED IN THE 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 FIFTH APPELLATE DISTRICT THE PEOPLE, F077587 Plaintiff and Respondent, (Super. Ct. No. BF170838A) v. TERRANCE WILEY, OPINION Defendant and Appellant. APPEAL from a judgment of the Superior Court of Kern County. Gary T. Friedman, Judge. Paul Couenhoven, under appointment by the Court of Appeal, for Defendant and Appellant. Xavier Becerra, Attorney General, Gerald A. Engler, Chief Assistant Attorney General, Michael P. Farrell, Assistant Attorney General, Julie A. Hokans and Robert Gezi, Deputy Attorneys General, for Plaintiff and Respondent. -ooOoo-  INTRODUCTION This case arises from what the prosecution theorized was a gang-related shooting death. The jury rejected the allegation that the murder was willful, deliberate and premeditated, but convicted defendant Terrance Wiley of second degree murder (Pen. Code, §§ 187, subd. (a), 189, subd. (b); count 1),1 shooting at an occupied vehicle (§ 246; count 2), possession of a firearm by a felon (§ 29800, subd. (a)(1); count 3), and reckless evasion of a peace officer (Veh. Code, § 2800.2; count 4).2 The jury found true that as to counts 1 and 2, defendant personally and intentionally discharged a firearm (§ 12022.53, subd. (d)); and as to counts 1, 2 and 3, defendant committed the crimes for the benefit of, at the direction of or in association with the Country Boys Crips (CBC) criminal street gang (§ 186.22, subd. (b)(1)). In a bifurcated proceeding, the jury found true that defendant had a prior felony conviction for first degree burglary, within the meaning of the “Three Strikes” law. (§§ 667, subds. (b)–(i), 1170.12, subds. (a)–(d).) On count 2, shooting at an occupied vehicle, the trial court sentenced defendant to an indeterminate term of 74 years to life in prison under section 186.22, subdivision (b)(4)(A).3 On count 1, the court imposed an indeterminate term of 15 years to life for murder, doubled to 30 years under the Three Strikes law, plus an additional 25 years to life for the firearm enhancement and five years for the serious felony conviction enhancement, stayed under section 654. On count 3, the court imposed the upper term of three years for being a felon in possession of a firearm, doubled to six 1 All further statutory references are to the Penal Code unless otherwise noted. 2 Section 29800 was amended effective January 1, 2021, but that amendment is not relevant to defendant’s conviction in this case. (Sen. Bill No. 723 (2019-2020 Reg. Sess.) ch. 306, § 1, pp. 1–3.) 3 The trial court calculated defendant’s sentence on count 2 in accordance with People v. Sok (2010) 181 Cal.App.4th 88 , 96–97: the upper term of seven years under section 246, 25 years to life for the firearm enhancement and five years for the prior serious felony enhancement, for a total of 37 years to life, doubled to 74 years under the Three Strikes law. 2. years, plus an additional four years for the gang enhancement, stayed under section 654. Finally, on count 4, the court sentenced defendant to a consecutive upper term of three years for reckless evasion, doubled to six years.4 On appeal, defendant claims that the jury’s gang enhancement findings are not supported by substantial evidence. He also claims that the trial court erred when it denied his motion to bifurcate the gang enhancements and erred under Evidence Code section 352 with respect to the admission of gang rap videos, the two predicate offenses committed by him and photographs of the victim’s body; and that, cumulatively, these errors violated his right to due process and a fair trial. Finally, defendant seeks remand to allow the trial court to consider whether to strike the prior serious felony conviction enhancement imposed under section 667, subdivision (a)(1) under Senate Bill No. 1393. (Stats. 2018, ch. 1013, §§ 1–2, pp. 1–6 (Senate Bill No. 1393 or Sen. Bill No. 1393).) The People offer no concessions and argue that remand under Senate Bill No. 1393 would be futile given the trial court’s comments during the sentencing hearing. As to counts 1 through 3, we agree with defendant that the evidence is insufficient to support the jury’s findings that he committed the crimes for the benefit of or in association with the CBC. However, we reject his claims of error with respect to bifurcation of the gang enhancements and admission of the gang rap videos, the two predicate offenses he committed, and the photographs of the victim’s body, which also forecloses his claim of cumulative error. Because this matter must be remanded for resentencing given reversal of the gang enhancements on counts 1 through 3, the parties’ 4 Although the parties did not raise the issue, given that remand for resentencing is required following reversal of the gang enhancements, discussed post, we observe that in the oral pronouncement of judgment, the trial court stated the determinate term would be served consecutively to the indeterminate term. This language originated with the probation report, but to the extent this led to any confusion, “[w]henever a person is committed to prison on a life sentence which is ordered to run consecutive to any determinate term of imprisonment, the determinate term of imprisonment shall be served first .…” (§ 669, subd. (a); accord, People v. Garza (2003) 107 Cal.App.4th 1081 , 1085.) 3. dispute over the propriety of remand under Senate Bill No. 1393 is moot and we do not reach the issue.5 FACTUAL SUMMARY I. Shootings Kenneth Cannon, Charles Richards, and Charles Tomlin, all of whom were in their 40’s, grew up together in Bakersfield. Cannon and Richards also previously worked together in construction and they acknowledged some acquaintance with defendant: Cannon said he had seen defendant around the neighborhood before and Richards said he recognized defendant because their mothers were good friends. Earlier in the evening of January 5, 2018, a group, including Richards, gathered at a house for a party. Although Richards stated at trial that he was drinking that night and no longer remembered who was there, he previously told police that Tomlin, known to Cannon and Richards as “99,” and defendant, known to Richards as “Tater,” were among those who attended the party. Later that night, Cannon and Richards both went to the Westfair Lounge (hereinafter the bar) in Bakersfield, each testifying he arrived alone. Richards drove his mother’s gold Chevy Impala with tinted windows and parked across the street from the front of the bar.6 Tomlin and defendant also showed up at the bar. Cannon, who frequented the bar most Saturday nights, saw Bruce Hollis there that night. Cannon knew Hollis because Hollis, then in his 50’s, had served time in prison for killing Cannon’s cousin in 1988. Cannon testified that he approached Hollis and said, “‘I forgive you for what you did to my cousin 20 years ago.’” Hollis invited him to go 5 In light of this disposition, defendant’s request for judicial notice of the legislative history for Senate Bill No. 620 (Stats. 2017, ch. 682, §§ 1–2, pp. 1–4 (Senate Bill No. 620 or Sen. Bill No. 620)) is denied as moot. 6 The bar and several other businesses were situated on a roughly triangular shaped lot bounded by Wilson Road to the north, Wible Road to the west, and Larson Lane to the east. The front of the bar was on the east side of the building, facing Larson Lane, and the bar’s parking lot was on the north side of the building. There was a Dollar Tree store and a large parking lot on the other side of Larson across from the bar. 4. outside to the smoking area and talk, but he declined because it “[d]idn’t feel right.” Hollis kept following him around the bar trying to talk to him, however. Tomlin also knew Cannon’s late cousin. After Tomlin arrived at the bar, Cannon told Tomlin and several women that Hollis was the one who killed his cousin. Cannon testified that after he and Tomlin went outside to smoke in front of the bar, Hollis again approached and tried to talk to him. Cannon and Tomlin both told Hollis that Cannon did not want to talk to him, and Tomlin punched Hollis. Hollis then drew a handgun and shot Tomlin eight times, killing him. After he shot Tomlin, Hollis calmly walked to his vehicle parked in the bar’s parking lot. After Hollis backed out of the parking space to leave, someone stood up from a crouched position and shot Hollis six times through the driver’s side of his vehicle. Although fatally wounded, Hollis was able to drive out of the parking lot, hitting another patron’s vehicle in the process, and proceed about one-quarter of a mile before his vehicle veered off the road and down an embankment, coming to rest against a cement retaining wall. Hollis was found slumped over in the driver’s seat, deceased. There was a .40-caliber pistol on the floorboard next to his left foot and a concealed carry holster with an extra ammunition magazine sitting on the transmission hump between the driver and passenger seats. When officers with the Bakersfield Police Department (BPD) responded to the bar, Cannon and an unidentified man were performing CPR on Tomlin, who was lying on the ground in front of the bar surrounded by a crowd of people. Seven spent shell casings were recovered from the front of the bar where Tomlin was shot, and seven spent shell casings were recovered from the parking lot where Hollis was shot.7 7 The jury heard that the shell casings recovered from the parking lot were swabbed for DNA, but results were not discussed. During motions in limine, the prosecutor noted that the case went to trial three months after the shooting and indicated that the swabs were not submitted for processing due to time constraints. 5. II. Flight from Scene Several people called 911 to report the shootings. An unidentified female caller reported Hollis’s shooting in the parking lot and described the shooter as a Black male on foot dressed in black and wearing a black “hoodie.” An unidentified male caller reported Tomlin’s shooting in front of the bar. He did not mention a second shooting, but reported that a Black man “left from there right away[]” in a gold car, possibly a Grand Am, and headed eastbound. Officer Mueller was two miles from the bar when he saw a gold sedan on eastbound Wilson Road waiting at a red light to turn left onto Union Avenue. Aware of the report that a gold sedan fled eastbound from the scene of the shootings, Mueller made a U-turn in his patrol vehicle to follow the sedan. The driver of the gold sedan then ran the red light and proceeded northbound with Mueller in pursuit. The driver ran several stop signs and reached speeds of more than 100 miles per hour in 30-mile-per-hour zones. The vehicle slowly came to a rest after becoming airborne and landing hard on all four wheels. As soon as the vehicle came to a rest, defendant got out and surrendered without incident. No one else was in the car. The sedan, a gold Impala, was registered to either Richards or his mother.8 Inside the sedan, police found a black ZTE cell phone on the driver’s seat, which was later linked to defendant’s sister through phone records.9 An orange sweatshirt and a black beanie with a “Soul Fresh” logo were on the front passenger floorboard, and a black hooded sweatshirt was on the rear passenger floorboard. Richards, who worked in construction, said the sweatshirt was probably his for work, but he denied the beanie and black sweatshirt were his. There was no firearm on defendant or in the sedan, and police 8 Richards testified the Impala was registered to his mother, and a detective testified he “believe[d]” he located registration paperwork with Richards’s name on it. 9 Defendant’s sister testified that he did not have his own phone and she lent him her phone earlier that day. 6. did not find anything when they searched around the bar and along defendant’s flight route. III. Shooter’s Identity The main issue at trial was the identity of the man who killed Hollis. At the time of his arrest, defendant, who is Black, was wearing a black T-shirt with a large graphic on the front that included a lot of white in the design; shorts with what a detective described as a dark camouflage pattern; black socks; and athletic shoes that had a lot of white in the design, including around the bottom.10 The jury saw photographs of defendant and his clothing following his arrest, and his clothing and shoes were also admitted into evidence. Detective Littlefield, who reviewed the surveillance camera footage from the bar, summarized below, testified that defendant was the only person he saw who was wearing shorts that night. A. Cannon and Richards Cannon stated he could not recall who was present outside when Hollis began shooting because he was “dizzy drunk[,]” but he thinks Richards might have been sitting on a bench. Notwithstanding contrary video surveillance footage, Cannon testified that as soon as Hollis began shooting, he ran east to the Dollar Tree parking lot. Cannon denied seeing defendant inside the bar that night, but said he might have seen defendant in the Dollar General parking lot after Tomlin was shot. He also denied he knew where defendant went or that he saw a gold Impala. Cannon stated he heard a second set of shots, but did not know where they were coming from, and he eventually walked back to where Tomlin was and tried to assist the person giving Tomlin CPR. After the ambulance arrived, he and Richards walked to the Valero gas station on Wilson Road and waited for an Uber ride to the hospital. 10 From the photographic evidence, defendant’s athletic-style shorts came down to his knees and were abstract patterned in gray, blue, and black with a gray stripe down the sides. 7.  Richards testified that he was sitting outside on a bench trying to sober up when he heard a burst of gunshots. He ran and then heard a second burst. He heard someone calling for an ambulance, returned, and saw Cannon and someone else giving CPR to Tomlin. After the ambulance arrived and police cleared the area, he noticed his car keys and car were missing. Richards acknowledged defendant was at the bar that night after viewing surveillance footage in court, but he denied they arrived at the bar together, denied knowing where defendant was at the time of the shooting and said he had no idea how defendant ended up with his car keys. B. J.C. 1. Trial Testimony At trial, J.C., who was in custody at the time for previously failing to appear, was no longer able to remember some of the details he initially reported to police, and he was unable to identify defendant as the man he saw that night. However, he testified that he went to the bar often and planned to meet his brother there that night to play pool. He thought it was sometime after midnight, closer to 1:00 a.m. He parked in the well-lit Dollar Tree parking lot across the street from the bar. From inside his truck, he had a partial view of the front of the bar, including the bench area where Tomlin was shot. J.C. sat in his truck for 15 or 20 minutes, debating whether to get out because he did not want any problems. He said the crowd mix varied depending on the night and it could get a little rough at times. He called his brother to tell him not to come “when all the commotion kicked off.” J.C. said there was a dark car parked on his right with no one inside. A gold, four- door compact car pulled in on the right side of the dark car and parked diagonally across the parking spaces, which caught his attention. He did not recall it having tinted windows, but said he could not see the driver at all due to the dark car parked next to him. Two Black men got out of the car. One was wearing black and appeared “all black[,]” and the other had some lighter clothing. They walked halfway to the bar and 8. then returned to the car. J.C. saw them briefly handling a fluorescent orange “work shirt type thing[]” from the passenger side of the car and then they walked across the street toward the bar. J.C. lost sight of them at that point because a bush obscured his view. He did not know if the car was running or not, but its lights were off. J.C. heard a gunshot, looked up, and saw a tall man in dark clothing standing over another man who was on the ground by the bench in front of the bar with his hands up. J.C. said the man fired again and he saw a muzzle flash. J.C. thought he heard three shots, but he is only able to hear out of one ear and he was on his phone at the time. He started his truck to leave after the second shot. The shooter walked away toward the bar’s patio area and disappeared from J.C.’s view. A man then ran from the north parking lot of the bar across the street directly to the gold car and “dove” into the back seat. The car almost immediately took off, screeched out of the parking lot, and headed east on Wilson Road. Because it happened so quickly, J.C. thought there must have been a driver waiting in the car, but he could not see into the driver’s side. J.C. called his brother at 12:49 a.m. to say he witnessed a shooting and he called 911 at 1:01 a.m., after driving home. J.C. said the black hoodie and socks he viewed in court were the same or similar to those worn by the man who ran and jumped into the car before it took off. He was unsure about the shoes, but recalled the man’s shoes were light colored. 2. 911 Call J.C.’s 911 call was played for the jury. J.C. reported witnessing the shooting in front of the bar and then hearing more shots fired. He mentioned that three men got out of the car when it arrived and that after the shootings, he saw a Black man with a hood and shorts run to the gold, four-door compact car after the shooting. 3. On-scene Statement J.C. was transported to the scene of defendant’s arrest, and his recorded statement was played for the jury. J.C. said he was not sure about the car at first because he had 9. thought it was Camry or something other than an Impala, but he said the Impala was the same color and he recognized the orange sweatshirt, which was displayed for him after he mentioned seeing the men with an orange- or yellow-striped sweatshirt.11 Officers also had J.C. view defendant, but he said he could not be certain because he did not see the man’s face. He said the men did not have hoods up when they exited the car, but the man who ran back to the car had on a black-hooded sweatshirt, or “hoodie,” with the hood up and he was wearing shorts that looked like the ones defendant had on when he was arrested. 4. Interview Statement J.C.’s audio-video recorded interview at the police station was also played for the jury. J.C. told Detectives Shaff and Koerner that three men got out of the gold compact car after it parked near him and were talking. All three men were Black and were wearing black or dark clothing. The first man had on a black hoodie with the hood down, dark patterned shorts with grey, and dark socks; the second man was in all dark clothing with black pants and a long top on; and the third man had hair. All three men started walking toward the bar. The second man kept going, but the other two returned to the car and retrieved an orange blanket or sweatshirt from the car that had an object wrapped in it. The men then put the orange thing back in the car and walked across the street to the bar. It was dark and J.C. saw a lot of black, but he described seeing the shooting in front of the bar and thought a person who looked like the second man was the shooter. He said the shooter “walked away like nothing[,]” and he lost sight of the man. J.C. then heard more gunshots and saw the first man in the hoodie run back to the car from the direction of the parking lot where the shots were fired. The man had his hood up and he 11 J.C. clarified at trial that he was just trying to describe something a roadworker would wear. 10. “dove in” the passenger area of the car, which then “took off fast” eastbound on Wilson Road. J.C. could not see the driver and although he did not see anyone return to the car except the runner, he thought there could have been a fourth person in the car when it arrived and he said, “Somebody was already sitting in there waiting.” C. R.K. and C.N. R.K. was a regular at the bar and he arrived around 10:30 p.m. He saw C.N. there, whom he knew, and he spent most of his time outside on the patio with her. C.N. knew Hollis, but R.K. did not. After C.N. intervened in an argument between Hollis and Cannon in front of the bar, R.K. told one of her friends to go get her. She returned to the patio and R.K. then heard multiple gunshots coming from the front of the bar. He pulled his friends down to the ground and, through the security bars that enclosed the patio, he saw Hollis walk by at a normal pace and get into his vehicle. A shadowy figure approached Hollis, and R.K. told his friends to get down because it was not over with. R.K. saw Hollis get shot and then saw Hollis hit his truck on the way out of the parking lot. R.K. said the shooter wore a plain, dark blue or black hoodie, but he did not see the person’s face, did not know the person’s race, and did not see the person in the bar earlier. He also said he did not know where the shooter went and did not recall telling law enforcement the person ran toward Dollar Tree, but after reviewing his prior statement, he said the shooter ran east toward the front of the bar and Larson Street. After looking at the damage to his truck outside, R.K., who was unlicensed and did not have registration or insurance, left. The collision had knocked his vehicle’s license plate off, however, and he was later contacted by law enforcement. During his police interview, R.K. described Hollis’s shooter as a Black man in a dark blue or black hoodie who ran eastbound toward Larson Street, but he did not see the shooter cross Larson. He was unable to see the shooter’s lower body because the shooter was crouched 11. down and there were vehicles in the way, but he stated the shooter approached on the passenger side of Hollis’s vehicle. When C.N. was interviewed shortly after the shootings, she said she stepped between Hollis, whom she knew, and a tall, mixed-race man, likely with a beard, whom she referred to as “‘white boy.’” She said the men were arguing about a murder 27 years ago and “‘white boy’” said something to the effect of, “‘You know I don’t like you. You killed my cousin.’” After she returned to the patio and heard what she thought were fireworks, she saw Hollis walk by, enter his vehicle, and strike another vehicle twice on his way out of the parking lot. At trial, C.N. testified with obvious reluctance, but she admitted that she knew Hollis from school and that R.K. pulled her down to the ground for her safety at one point. However, she stated she did not know why R.K. pulled her down, she insisted she did not see or hear anything that night and when questioned regarding her prior statement to law enforcement, she denied making the statements attributed to her. D. I.P. and R.O. Friends I.P. and R.O. were at the bar that night, along with I.P.’s wife. They were outside at a table in the enclosed patio when I.P. heard multiple gunshots coming from the front of the bar on Larson Street. I.P. thought they were fireworks at first, but he and R.O. saw a large man with a gun in his hand walk by from the front of the bar, get in his vehicle, and back out. Someone who had been crouched down then “hopped out and just, pointblank, started firing at the driver’s side.” The man in the vehicle hit another vehicle before driving out of the parking lot, and the shooter ran east toward Larson Street. I.P. testified the shooter was wearing a plain black hoodie pulled up over his head and jeans, but he did not see the shooter’s face. He spoke with police more than once and he recalled telling them that the shooter was Black, but he said he also told them that the shooter could have been wearing black gloves. During his police interview, I.P. said the shooter was wearing “jean short, uh, jean pants.” 12.  R.O. could not tell where the shooter came from, but he thought it was from the direction of Larson Street. He did not see the shooter’s face or recall seeing him earlier at the bar, but the shooter was wearing a plain, dark sweatshirt with the hood pulled up and R.O. saw something white, but he was unsure whether it was from the shooter’s socks or shoes. The black sweatshirt he viewed in court was similar to what he saw that night, but he was unsure about the shoes. R.O. told police that he did not know the race of the shooter and first stated the shooter wore a black-hooded sweatshirt, jeans or shorts, and white shoes. He later stated that the shooter appeared to be wearing blue jean-type shorts. E. Video Surveillance Footage The bar had eight operating surveillance cameras, but none captured Tomlin’s shooting in front of the bar or Hollis’s shooting in the parking lot. However, the footage showed defendant, Cannon, Richards, and Tomlin together at the bar that night, and it showed several interactions with Hollis. Defendant was wearing a dark beanie with white writing on it, a dark-hooded sweatshirt, shorts and athletic shoes, and Cannon was wearing a white baseball cap that glowed distinctively on the camera footage. At approximately 12:50 a.m., footage from inside the bar and from the enclosed outdoor patio, which lacks audio, shows patrons react to something and flee. Hollis is visible through the security bars around the patio walking from the area in the front of the bar toward the bar’s parking lot. Approximately 10 seconds later, a shadowy figure moves quickly past the patio from the front of the bar toward the bar’s parking lot. The white in his shoes stands out noticeably. Approximately 10 seconds after that, a man who appears to be Cannon based on body size, clothing and glowing baseball cap is visible through the patio’s bar walking from the front of the bar in the direction of the bar’s parking lot and then back toward the front of the bar. 13. IV. Gang Evidence A. Background Relevant to the murder charge, the gang enhancements and the gang special- circumstance allegation under section 190.2, subdivision (a)(22), the prosecutor’s theory was that defendant and Tomlin were active participants in CBC at the time of the shooting, and after Hollis, a rival East Side Crips (ESC) gang affiliate, gunned down Tomlin, defendant avenged Tomlin’s death in adherence with gang code. The prosecution’s gang expert, BPD Detective Robert Pair, testified that during his 17-year career, he was primarily assigned to the east side of Bakersfield, which included CBC and ESC gang territory, and the majority of his experience related to the CBC, ESC, West Side Crips (WSC), and Bloods gangs. Pair testified that Crips gangs are primarily, but not exclusively, Black gangs, and at the time of trial, he estimated there were approximately 100 active CBC members and at least 300 active ESC members. CBC claims the territory bordered by East Belle Terrace to the north, East White Lane to the south, Cottonwood Road to the east, and Union Avenue to the west; and ESC claims the territory directly north, bordered by East California Avenue to the north, East Belle Terrace to the south, Mount Vernon Avenue to the east, and Union Avenue to the west. CBC and ESC are rivals, and CBC aligns with WSC, which claims territory west of Union Avenue. CBC’s primary activities are narcotic sales, weapons violations, burglary, auto theft, and murder; its gang color is powder blue; it identifies with the North Carolina Tar Heels (N-C) sports team; and it frequently uses graffiti “as a visual indicator.” Gang- related acronyms include CBC, ESK, and WSK, as well as 1400 for the 1400 block of Reese Avenue and 700 for the 700 block of Watts Drive, which Pair described as areas of historical significance for CBC. Although also legitimate businesses, historical hangouts for CBC include Watts Market at Watts Drive and Lotus Lane, and Hollywood Market at Planz Road and Shellmacher Avenue. “Hood Day,” which Pair’s testimony indicates is 14. an annual day of celebration for gangs, is March 23 for CBC because the numbers 3-2-3 correspond with the alphabetical order of the letters C-B-C. Pair described CBC as an umbrella gang that includes subsets based on streets or geographic areas, and said it is the most structured of the Crips gangs. Examples of subsets include Notorious Country, Neighborhood Country, Watts and Locust, Reese and Cheatham, and Mad-Block for Madison Avenue. He also described CBC as “more insular[,]” “tight-knit,” “unified,” and “family based” than other Crips subsets, and stated its mottos include “‘south, love, and loyalty.’” Pair stated members usually exit CBC at death, and although he acknowledged that some occasionally either simply leave or age out, those are difficult avenues of exit from the gang if the individual remains in the same environment with the same people. B. Predicate Offenses For the purpose of demonstrating that CBC is a criminal street gang involved in a pattern of criminal gang activity, the prosecution offered evidence of six predicate offenses, two of which involved defendant. (§ 186.22, subd. (e).)12 1. D’Vontae Pink In February 2013, D’Vontae Pink, a CBC known as Fido, committed a series of shootings in ESC territory. During one incident, Pink and Jimmy Baker drove by a market frequented by ESC members and opened fire, killing one person. Several weeks later, another shooting occurred. In connection with the shootings, Pink was convicted of murder, aggravated assault, shooting at an inhabited dwelling, being a gang member in possession of a firearm, gang participation, and discharging a firearm from a vehicle. 12 Under the gang statute, “‘pattern of criminal gang activity’ means that gang members have, within a certain time frame, committed or attempted to commit ‘two or more’ of specified criminal offenses (so-called ‘predicate offenses’).” (People v. Gardeley (1996) 14 Cal.4th 605 , 610, disapproved on another ground by People v. Sanchez (2016) 63 Cal.4th 665 , 686, fn. 13 (Sanchez). 15.  Pink had two tattoos that Detective Pair found significant: “N-C” on his arm for the North Carolina Tar Heels and “187” on his forehead, which is the Penal Code section for murder and was added by Pink sometime after his arrest. Pair also identified Pink and defendant together in a Facebook photograph that was captioned “‘my two H-blocc.’” Prior testimony by defendant’s sister established that the photo of Pink and defendant was posted to her Facebook page on March 18, 2018, at the same time she had a scheduled visit with Pink. However, she denied taking the photo or posting it, she stated Hacienda is the street she grew up on, and she denied there was any significance to the spelling of “blocc,” stating, “[T]hat’s just how I wrote it[]” and “I spell it how I want to spell it.”13 2. Adolphus Newell In 2014, officers were monitoring a large gathering and when they approached Adolphus Newell, who was under the age of 21 and “wearing a shirt with a lot of gang related writing on it[,]” Newell ran and threw a gun. Officers recovered the gun and subsequently located Newell at his residence. Officers also seized a shirt that read “S-S,” “free Jimmy Baker,” “CBC[,]” “ESK” for East Side Killer, “LVK” for Lakeview Killer, “SBK” for Stroller Boy Killer, and “SGK” for Spoonie G Killer, and also included two dollar signs and several other acronyms that were not explained in testimony. Newell, an active CBC participant, was convicted of carrying a loaded firearm in public and gang participation. 3. Paul Timberlake On November 7, 2014, Paul Timberlake, an active CBC participant, was at a bar with other CBC gang members. Lionel McGee, who was a gang rival, showed up at the 13 Discussed post, the prosecution introduced evidence that the gang substitutes “c-c” for “c-k” in words because “c” and “k” together denote Crips killer, something CBC, as a Crips gang, avoided. 16. bar with his girlfriend and got into a verbal altercation with Timberlake. Timberlake shot McGee to death and was subsequently convicted of murder, gang and firearm charges. 4. Kevin Vaughn On April 22, 2016, officers executed a search warrant for the residence of Kevin Vaughn, who had assaulted an officer the day before. They located two firearms and a large quantity of drugs at the residence. Vaughn, an active participant in CBC, was convicted of two counts of being a felon in possession of a firearm, gang participation and two counts of possessing a controlled substance for sales. 5. Defendant On April 30, 2012, Deputy Vorhees with the Kern County Sheriff’s Department (KCSD) responded to a report of a possible burglary in progress. When he arrived at the address, witnesses pointed west to a different house, where he saw two Black men entering the back of a residence. After waiting for backup to arrive and ordering the men to come out, Vorhees and other deputies entered the residence. Vorhees located defendant hiding in a closet under a blanket and his partner located Tyrone Lee hiding in the attic. Following defendant’s and Lee’s arrests, Vorhees returned to the residence identified in the call for service. Defendant and Lee were identified by a witness there, and Vorhees located a shoeprint on the door that matched a shoeprint at the residence where defendant and Lee were found hiding. Defendant, whom Pair opined was an active CBC participant at the time, was convicted of residential burglary. Finally, on February 15, 2016, Detective Garrett assisted other officers during a traffic stop. The driver was Jacob Ray and defendant was sitting in the front passenger seat. A partially open backpack containing a semiautomatic handgun was in the middle of the back seat. Defendant, whom Pair opined was an active CBC participant at the time, was subsequently convicted of being a felon in possession of a firearm. 17.  C. Other Gang-related Contacts On July 17, 2010, KCSD Deputy Colbert, along with BPD officers, monitored a party following the funeral for Traveon Avila, who was shot and killed by BPD. The party was in the cul-de-sac where Avila, known as Kidd, was shot and Colbert stopped several vehicles leaving the area, either for traffic violations or because the individuals were subject to search conditions. During those stops, Colbert had contact with various CBC gang members, including Donnell Robinson and Tyrone James. Robinson was wearing powder blue shorts and a T-shirt memorializing Avila, which read something to the effect of “‘south in peace[.]’” During Robinson’s search, Colbert found a camera with a memory card containing photographs from the funeral, including some with gang members, and a video with Robinson rapping about the funeral and Avila’s passing. The video, which contained derogatory statements about BPD (hereinafter 2010 BPD video), also featured Tyrone James. Lieutenant Stratton, who was an officer with the gang unit at that time, subsequently viewed the 2010 BPD video Colbert found on Robinson’s camera. Stratton had multiple prior contacts with defendant and testified he was able to tell defendant apart from his twin brother even though they looked similar and dressed similarly. Stratton identified defendant in the video; he was throwing gang hand signs for CBC and “SS for South Side Country Boy[,]” and he said, “‘fuck Stratton[.]’” On May 29, 2011, defendant and three other men were contacted by law enforcement in the public parking lot of a convenience store. Defendant admitted he was a member of CBC. During the search of a residence on February 20, 2013, law enforcement located a letter authored by defendant in one of the bedrooms. Detective Pair testified to the contents of the letter and stated he found it significant that throughout the letter, a single “S” was replaced with “two S’s” for South Side, a CBC reference; the letter “E” was replaced with the number 3; and “C-K” was replaced with “C-C.” The letter also 18. contained R.I.P. and a series of nicknames, some of which were familiar to Pair, and it concluded with “‘lov[3] you, bro[.]’” Defendant and Pink lived on the same street within one block of one another, and on October 3, 2013, Officer Malley contacted defendant as he was on the front lawn of Pink’s residence walking away. Malley inquired about defendant’s wrist tattoos, described as tombstones with monikers on them. Defendant told Malley he was a CBC and his homeboys’ names were on the tombstones. The monikers included Ant, Q Locc and Kidd, and defendant told Malley that Kidd was a CBC who was shot and killed by BPD. Malley knew Kidd to be Traveon Avila. Detective Pair later testified that defendant also has ESK (East Side Killer) and LVK (Lakeview Killer) tattoos; and that with respect to defendant’s in memoriam tattoos, Ant referred to Anthony Daniels, who was in CBC, and although Pair did not know who Baby V and Fido 3 were, their nicknames evidenced the gang’s “sponsor[ship]” practice where more senior members add less senior members to their nicknames. Pair explained that this is done by the addition of “big,” “little,” “baby,” “tiny[,]” or numbers to a more senior member’s nickname; and he knew Baby V was someone under Vanis Anthony’s structure and Fido 3 was someone under Pink’s structure. On November 21, 2013, Malley was involved in the search of a bedroom defendant purportedly shared with his two brothers. Malley located paperwork belonging to defendant, and he took photographs, which were shown to the jury. One photograph showed a tribute shirt with a picture of Avila against a powder blue background and the phrase “‘in loving memory’” or “‘in love and memory[,]’” as well as a photograph of a CBC meeting in front of a house within the gang’s territory. Other photographs showed “‘R.I.P. Ant[]’” written by someone on the trim around the closet, and a funeral pamphlet and a birthday card on the wall. The birthday card, which was not addressed to anyone, had a Watts and Locus street sign, the letters “S-S” and “N-C,” “Burr[,]” and “‘Happy C-Day Locc’” written on it. There were only two beds in the room and items were 19. strewn throughout the room, leading Malley to doubt that three people slept there full- time. Defendant and his twin brother were contacted by law enforcement during a traffic stop on March 18, 2014. Defendant’s brother had a mohawk haircut with “CB” shaved in the back, and defendant was wearing powder blue clothing and shoes. On May 3, 2015, Officer Montgomery responded to Hollywood Market. Defendant and another man were standing across the street in a dirt field by a tree stump. Three other men walked away as Montgomery approached. Montgomery located a firearm approximately 10 feet from where defendant and the man were standing, and he located footprints within two to three feet of the firearm that matched the shoes defendant was wearing. No charges were filed, however. Between December 12, 2015, and January 1, 2016, Detective Garrett, then an officer, viewed a Facebook account under the name of Ssub Zxro, which he knew to be associated with Jacob Ray. Garrett took a photograph of a four-picture collage posted on December 29, 2015. In one of the photographs, defendant was in a black shirt with a blue, airbrushed “H-B” on it for Hacienda Block. The shirt also had on it “ESK” for East Side Killer; “SGK[]” for Spoonie G Killer; “LVK[]” for Lakeview Killer; “MCK” for Mid-City Killer; “CBC[]” for Country Boy Crips; “S[]” for South, which is also associated with CBC; and “‘dicc fuck Raggz dead[.]’” Garrett testified that Raggz was Lionel McGee, a notable ESC member killed by Timberlake in 2014, and that “‘dicc’” means “[d]ick,” but Crips avoid writing “C” and “K” together because it means Crips killer. In the photograph, defendant was forming the letter “H” with his hand above the “H-B” on his shirt and Jacob Ray was on his right wearing a powder blue shirt, a backwards hat and a bandana around his mouth. During a contact on January 10, 2016, at Hollywood Market, Officer Jeffries asked if defendant was still an active CBC member. Defendant replied, “‘[Y]eah, but I don’t do much anymore.’” He also stated that he had been a member for “‘a long time.’” 20.  On May 3, 2016, Officer McIntyre contacted defendant at his residence and gave him a letter from “Bakersfield Safe Streets Partnership,” which is an outreach program by BPD and local churches. Defendant asked why he needed the program and McIntyre told him that unless he was no longer a CBC, he probably needed to go. Defendant responded, “‘Well, I’ll never change, but I’ll go.’” Finally, the prosecutor introduced two photographs of defendant and Hassan Rogers that were uploaded to a Facebook page on March 30, 2018. In one, Rogers was making a sign for Watts and Lotus with his right hand and defendant was making an “H” with his hand. Pair testified he knew Rogers to be a CBC, and he noted that the two were in custody together following defendant’s arrest in this case. D. Video Evidence The prosecution introduced four gang-related rap videos into evidence, one of which was on the memory card Deputy Colbert seized from Donnell Robinson and three of which were downloaded from YouTube by Detective Pair. The 2010 BPD video seized by Colbert and described by Lieutenant Stratton ante, was made shortly after the death of Traveon Avila, who was shot by police. Detective Pair testified that the lyrics, which centered around “‘fuck BPD[,]’” were not of great value to him with respect to evaluating gang activity because people were understandably upset about the shooting. However, the prevalence of CBC gang hand signs throughout the video; and defendant’s shirt, hand signs, and call out to a specific BPD officer (Stratton) were significant in the context of evaluating defendant’s gang involvement. In the first YouTube video, entitled “S-One Country Til Death[,]” Pair identified Tomlin as a participant and he also recognized Tyrone Lee, who was arrested with defendant in 2012 for burglary. Pair explained that the “Watts 700 ESK[]” T-shirt worn by several other participants signified the 700 block of Watts Drive, which is in CBC territory, and ESK, or East Side Killer, signaled disrespect for CBC’s rival. Multiple participants were throwing gang signs, including “W” and “L” for Watts and Lotus and 21. “C-W[]” for Cottonwood, and the video featured the empty field across from Hollywood Market and shots of Watts, Lotus, Planz and Shellmacher street signs. The prosecutor highlighted the lyrics, “You gotta know your history[,]” and “I’m in the field where the soldiers be[]”; and Pair explained that CBC “is deep on history” and in an ongoing war with ESC. In the second YouTube video, entitled “Lu Kane O.B.L.[,]” numerous participants were wearing powder blue and the video featured shots of Tomlin, Watts Market, the cul- de-sac where Avila died, and a cross in memory of Avila. “S.I.P.” was visible on a building in some of the cul-de-sac shots, and Pair explained that “south in peace” and “rest in peace” are used interchangeably. Pair identified numerous participants in the video, and he explained that the lyrics, “[W]hy ya’ll run your mouth like we ain’t got guns[,]” and “Like we gonna cross Belle Terrace with them hot ones[,]” referred to “somebody talking … crap.” He also explained that Belle Terrace borders ESC territory and he opined that “hot ones” referred to guns. The third YouTube video, entitled “Ryda’s (S.I.P. GLOCC),” was uploaded to YouTube on March 5, 2018, and Pair described it as a tribute video to Tomlin (hereinafter tribute video). Tomlin was featured in various shots, including at Hollywood Market, and Pair also recognized Donnell Robinson and Tyrone James in the video. The prosecutor highlighted the line, “[T]rouble packing two Glock nines for my … Hubba Bubba[,]” and Pair explained that Tomlin’s nickname was GLOCC 99, meaning double, or two, Glock .9-millimeter guns. The prosecutor also highlighted the phrase, “Catch ya slippin[,]’” and Pair opined it meant to catch someone unaware, in this context a “rival … so that something violent can happen.” With respect to the word “ryda,” Pair explained that CBC avoids the use of the letter E due to its association with ESC and will instead write the word a different way, replace the letter E with the number 3, or cross out the E. 22.  E. Defendant’s, Tomlin’s and Hollis’s Gang Affiliation During his trial testimony, Cannon stated that he used to affiliate with CBC, but that was 10 or 15 years ago. There was no other evidence introduced linking Cannon to a gang, and there was no evidence linking Richards to a gang. However, based on a totality of the circumstances, Pair opined that at the time of the shooting on January 6, 2018, Tomlin and defendant were active CBC participants. With respect to defendant, Pair based his opinion on the gang contacts, the 2010 BPD video related to Avila’s death, photographs, and tattoos, previously summarized. Pair opined that Tomlin was an “original gangster” or “O.G.” who had clout and was respected within CBC. In forming this opinion, Pair relied on Tomlin’s level of participation in the three CBC-related rap videos, one of which was a tribute to Tomlin uploaded after his death. Tomlin was not merely a background participant in the videos, and Pair explained that this level of participation would not be afforded someone who was merely a family member or who merely hung out, nor would a nonmember receive a “S.I.P” tribute video. Additionally, Tomlin had one ESK tattoo, and three photographs obtained from his cell phone were introduced at trial. One photograph included Tomlin’s nickname, GLOCC 99 with a “C” in place of the “K”; another showed Tomlin making a hand sign for “Feliz[]” while standing next to a man making what appeared to be a Watts and Lotus hand sign; and the third showed Tomlin with Donnell Robinson aka Diggz and Gregory Miller, both of whom Pair was familiar with based on his investigation into CBC. Regarding Hollis, Pair testified that “historical data points towards” ESC membership “at one point[,]” but “a lot of that information [was] extremely dated.” Pair opined that Hollis had some affiliation with ESC, but Pair did not have enough recent information to conclude that Hollis was an active gang member. 23.  F. Hypothetical Finally, Detective Pair testified that when a CBC member is attacked, the expectation is that fellow gang members will jump in and a failure to act will result in discipline, including but not limited to fighting one or more fellow gang members. The prosecutor then asked Pair the following hypothetical question: “A well-known Country Boy Crip[s] gang member is shot down in front of a local bar by a rival gang member from the East Side Crips. The rival East Side Crip[s] gang member walks to his nearby vehicle and begins to leave. As he is leaving, another Country Boy Crip[s] gang member runs up next to the vehicle, fires multiple rounds into it. The East Side Crip[s] gang member drives off, but crashes nearby where he is found deceased. [¶] Do you have an opinion as to whether or not that incident in the hypothetical … was for the benefit of or in association with a criminal street gang such as the Country Boy Crips?” Pair opined the crime would be committed for the benefit of and in association with CBC. He explained, “One, there’s a tit for tat. And it’s referenced in some of the rap lyrics you heard that if they get one of ours, we’re going to get one of theirs. So we set that to the side. There’s an expectation, they get one of ours—and I’m speaking as a gang member—then we’re going to get one of theirs. [¶] The second is that if somebody is a high ranking member of your organization and they’re killed in front of you, and you have the means to enact vengeance or retaliation, then you’re expected to. And it’s just part of that lifestyle and being a gangster. And not doing that would be extremely odd behavior and probably punished. And that’s even setting aside any kind of friendship or anything else. That’s just straight hood rules, for lack of a better term. And that you absolutely have to jump when something happens like that.” 24.  DISCUSSION I. Substantial Evidence Challenge to Gang Enhancements A. Standard of Review “The Due Process Clause of the Fourteenth Amendment denies States the power to deprive the accused of liberty unless the prosecution proves beyond a reasonable doubt every element of the charged offense[]” (Carella v. California (1989) 491 U.S. 263 , 265, citing In re Winship (1970) 397 U.S. 358 , 364), and the verdict must be supported by substantial evidence (People v. Zamudio (2008) 43 Cal.4th 327 , 357). “In considering a challenge to the sufficiency of the evidence to support an enhancement, we review the entire record in the light most favorable to the judgment to determine whether it contains substantial evidence—that is, evidence that is reasonable, credible, and of solid value— from which a reasonable trier of fact could find the defendant guilty beyond a reasonable doubt. [Citation.] We presume every fact in support of the judgment the trier of fact could have reasonably deduced from the evidence. [Citation.] If the circumstances reasonably justify the trier of fact’s findings, reversal of the judgment is not warranted simply because the circumstances might also reasonably be reconciled with a contrary finding. [Citation.] ‘A reviewing court neither reweighs evidence nor reevaluates a witness’s credibility.’” (People v. Albillar (2010) 51 Cal.4th 47 , 59–60 (Albillar); accord, People v. Livingston (2012) 53 Cal.4th 1145 , 1170.) B. Background “In 1988, the Legislature enacted the California Street Terrorism Enforcement and Prevention Act (the STEP Act). (§ 186.20 et seq.)” (People v. Hernandez (2004) 33 Cal.4th 1040 , 1047 (Hernandez).) “‘Underlying the STEP Act was the Legislature’s recognition that “California is in a state of crisis which has been caused by violent street gangs whose members threaten, terrorize, and commit a multitude of crimes against the peaceful citizens of their neighborhoods.” (Pen. Code, § 186.21.) The act’s express purpose was “to seek the eradication of criminal activity by street gangs.” [Citation.]’ 25. [Citation.] In pursuit of this goal, the STEP Act focuses upon ‘patterns of criminal gang activity and upon the organized nature of street gangs, which together, are the chief source of terror created by street gangs.’ (§ 186.21.)” (People v. Rodriguez (2012) 55 Cal.4th 1125 , 1129, fn. omitted.) Relevant here, “a defendant who commits a felony in furtherance of criminal street gang activity is subject to increased punishment.” (People v. Fuentes (2016) 1 Cal.5th 218 , 223.) The gang enhancement, codified in section 186.22, subdivision (b)(1), applies to felonies “that were (1) ‘committed for the benefit of, at the direction of, or in association with any criminal street gang,’ and (2) ‘with the specific intent to promote, further, or assist in any criminal conduct by gang members.’” (People v. Rivera (2019) 7 Cal.5th 306 , 331.) “‘Not every crime committed by gang members is related to a gang’ for purposes of the enhancement [citation], but the enhancement applies ‘when a defendant has personally committed a gang-related felony with the specific intent to aid members of that gang’ [citation].” (Ibid., quoting Albillar, supra, 51 Cal.4th at pp. 60, 68.) Although gang membership is not an element of the enhancement, gang evidence can nevertheless bolster the prosecution’s theory on the elements it is required to prove. (Sanchez, supra, 63 Cal.4th at pp. 698–699; People v. Gutierrez (2009) 45 Cal.4th 789 , 820; Hernandez, supra, 33 Cal.4th at pp. 1044–1049; People v. Villa-Gomez (2017) 9 Cal.App.5th 527 , 541.) “Gang membership is simply circumstantial evidence establishing that the crime was gang related and a motive for why a defendant may have harbored the ‘specific intent to promote, further, or assist in any criminal conduct by gang members.’” (People v. Villa-Gomez, supra, at p. 540.) C. Analysis 1. Summary of Parties’ Positions Relying on People v. Ochoa, People v. Ramon, and People v. Albarran, defendant claims that the evidence in this case is insufficient to support either element of the gang 26. enhancement, entitling him to reversal. (People v. Ochoa (2009) 179 Cal.App.4th 650 , 653 (Ochoa) [evidence insufficient to support gang enhancement where the defendant acted alone when he demanded the victim’s vehicle at gunpoint, and he was not wearing gang colors, did not flash any gang signs, and did not make any gang-related statements]; People v. Ramon (2009) 175 Cal.App.4th 843 , 853 [presence of two gang members in gang territory in stolen truck with unregistered firearm insufficient to support gang enhancement, at least where gang expert did not identify possession of stolen vehicles as a primary activity of the gang]; People v. Albarran (2007) 149 Cal.App.4th 214 , 217 (Albarran) [trial court reversed gang enhancements for insufficient evidence, but its error in admitting “extremely prejudicial gang evidence” also entitled the defendant to retrial on all charges]; see In re Frank S. (2006) 141 Cal.App.4th 1192 , 1199 [a minor’s “criminal history and gang affiliations cannot solely support a finding that a crime is gang-related under section 186.22.”].) Defendant points to the absence of any evidence that the crimes committed were gang related, other than defendant’s and Tomlin’s shared gang affiliation. The People respond that the jury could have reasonably inferred that Hollis was affiliated with ESC and the circumstances surrounding the crimes, namely that defendant shot a rival gang affiliate after that affiliate shot a respected member of defendant’s gang, are sufficient to uphold the gang enhancement findings. For the reasons set forth below, we agree with defendant and reverse the gang enhancements attached to counts 1 through 3. 2. Gang Membership and Commission of Crime Insufficient “Gang membership, standing alone, is not a crime[]” (People v. Elizalde (2015) 61 Cal.4th 523 , 539), and “[a] gang [finding] cannot be sustained based solely on [a] defendant’s status as a member of the gang and his subsequent commission of crimes[]” (Ochoa, supra, 179 Cal.App.4th at p. 663; accord, People v. Rios (2013) 222 Cal.App.4th 542 , 573–574 (Rios); In re Frank S., supra, 141 Cal.App.4th at p. 1199). However, “‘[e]xpert opinion that particular criminal conduct benefited a gang’ is not only 27. permissible but can be sufficient to support the Penal Code section 186.22, subdivision (b)(1), gang enhancement[]” (People v. Vang (2011) 52 Cal.4th 1038 , 1048, quoting Albillar, supra, 51 Cal.4th at p. 63; accord, People v. Garcia (2016) 244 Cal.App.4th 1349 , 1367–1368), and “if substantial evidence establishes that the defendant intended to and did commit the charged felony with known members of a gang, the jury may fairly infer that the defendant had the specific intent to promote, further, or assist criminal conduct by those gang members[]” (Albillar, supra, at p. 68; accord, People v. Franklin (2016) 248 Cal.App.4th 938 , 949 (Franklin); Rios, supra, at pp. 573–574). “[T]he typical close case[, therefore,] is one in which one gang member, acting alone, commits a crime.” (People v. Morales (2003) 112 Cal.App.4th 1176 , 1198; accord, Rios, supra, at p. 574.) The crimes in this case did not involve any of the more common hallmarks of gang-relatedness: the crimes were not committed in gang territory or at a location associated with gang activity, none of the involved parties wore any gang clothing or colors, no gang slurs or gang hand signs were used, there was no evidence that defendant knew Hollis or knew that he had a past or present association with ESC, and there was no evidence that defendant committed the crimes with other gang members or in the presence of other gang members. The absence of these factors is not necessarily fatal to a gang-enhancement finding, and we are mindful of Detective Pair’s testimony that gang members are rarely “suited and booted head to toe in a particular gang color anymore[]” unless it is Hood Day. Nevertheless, the prosecution must demonstrate more than defendant’s gang membership, his commission of a crime, and a broad theory that he acted in accordance with general gang culture; and the “‘hypothetical question [relied on] must be rooted in facts shown by the evidence.’ [Citation.] Indeed, an ‘expert’s opinion may not be based “on assumptions of fact without evidentiary support [citation], or on speculative or conjectural factors.”’” (Franklin, supra, 248 Cal.App.4th at p. 949, citing People v. Richardson (2008) 43 Cal.4th 959 , 1008 & People v. Gardeley, supra, 14 28. Cal.4th at p. 618; see In re B.J. (2020) 49 Cal.App.5th 646 , 651 [carjacking of higher-end vehicle in gang territory on Hood Day sufficient to support gang enhancement where expert explained the crime’s financial benefit to the gang and the significance of younger gang members committing crimes on Hood Day].) a. Showing Strength and Instilling Fear in Community On appeal, the People argue that the jury could have reasonably concluded that Hollis’s shooting “was intended to demonstrate the strength and cohesiveness of the [CBC] and to promote fear in the community through a swift, violent and vengeful act.” Neither the prosecutor’s hypothetical question nor Pair’s response to it involved benefit to a gang through a show of strength or instilling fear in the community. This is telling. We agree with the People that either theory might suffice to demonstrate a benefit to a criminal street gang in a given case. Here, however, there was nothing about the circumstances of the crimes that would have alerted members of the community, either at the bar that night or at large, that the crimes were committed by a gang member or were otherwise gang related. As such, the record is devoid of any basis for reasonably inferring that the crimes benefited CBC through a show of strength or by instilling fear in the community. (People v. Perez (2017) 18 Cal.App.5th 598 , 613–614; Rios, supra, 222 Cal.App.4th at p. 574; In re Daniel C. (2011) 195 Cal.App.4th 1350 , 1363–1364; Ochoa, supra, 179 Cal.App.4th at p. 663.) b. Retaliatory Killing of a Gang Rival The People also argue that defendant shot Hollis because he was a rival gang member and that the jury could reasonably infer defendant’s knowledge of Hollis’s ESC affiliation from Pair’s testimony. We are unpersuaded. Pair opined that Hollis “had some affiliation to the [ESC,]” based on “historical data[,]” “a lot [of which was] extremely dated[,]” but which pointed toward ESC membership at one point. Pair noted that Hollis’s most recent interactions with law enforcement were in 2009 and again in 2016, but the nature of those contacts was not specified and the record is devoid of any 29. evidence from which it may be inferred that the interactions were at all related to ESC. At best, Pair’s testimony shows that Hollis, who was 52 years old at the time of his death, had some past link to ESC, but it does not support a reasonable inference that Hollis was an affiliate or member of ESC at the time of his death, and, furthermore, there is no evidence that defendant, who was only 24 years old, knew Hollis prior to the night of the crime or considered Hollis a gang rival. The People contend that it was reasonable for the jury to infer a gang rivalry between defendant and Hollis because CBC and ESC share a territorial boundary; defendant and Cannon were CBC members; and defendant was at the bar at the same time as Cannon and Hollis, who had a shared history. The People’s position is untenable. In addition to the absence of any evidence defining Hollis’s relationship with ESC at the time of the crime, Pair also testified that ESC has at least 300 active members, probably significantly more; and while the size of the gang’s respective territories was never defined, it bears mention that Bakersfield is a sizeable city rather than a small town. Evidence that CBC claims territory south of East Belle Terrace and ESC claims territory north of East Belle Terrace, without more, does not support a reasonable inference that defendant would have known Hollis and known he was affiliated with ESC. Regarding Cannon’s status, although defendant committed the crimes alone, he was at the bar with others and we recognize there is no entitlement in gang cases to a presumption that family or friendship ties predominate over gang ties. (Albillar, supra, 51 Cal.4th at p. 62; accord, People v. Weddington (2016) 246 Cal.App.4th 468 , 484.) However, at 46 years old, Cannon was more than 20 years older than defendant and while the jury was not required to believe Cannon’s testimony that he was merely acquainted with defendant from seeing him around the neighborhood, there was no evidence of a closer relationship. Nor did Pair or any other law enforcement officer offer an opinion as to Cannon’s—or Richards’s—gang involvement, past or present. This leaves only Cannon’s testimony that while he used to affiliate with CBC, he gave up gang life 10 or 30. 15 years ago when he grew up and started working, at which time defendant was still a child. As such, the People’s assertion that defendant and Cannon were linked by a shared gang membership is purely speculative. Finally, support for the People’s position that defendant sought to avenge Tomlin’s death because of his stature within the gang is tenuous. Viewed in the light most favorable to the prosecution, both men were affiliated with CBC at the time of Tomlin’s death, Tomlin occupied a position of respect in the gang, and the two socialized that night at the bar. However, Tomlin did not appear with defendant in the 2010 BPD video filmed after Avila’s funeral, defendant did not appear in any of the three YouTube videos offered to establish Tomlin’s heightened stature in the gang, and with the exception of the night of the crime, Pair did not review any information linking defendant and Tomlin. There was also no evidence supporting a reasonable inference that all CBC members know one another. To the contrary, Pair stated that CBC members further identify with subsets based on their neighborhoods, but he did not know which subset, if any, either defendant or Tomlin claimed. It may well be that defendant knew Tomlin was a respected OG in CBC, but there must be evidence offered at trial that would allow a reasonable trier of fact to draw that inference; here the evidence falls short. (People v. Rekte (2015) 232 Cal.App.4th 1237 , 1247 [“A reasonable inference may not be based on suspicion alone, or on imagination, speculation, supposition, surmise, conjecture, or guesswork; a finding of fact must be an inference drawn from evidence rather than a mere speculation as to probabilities without evidence.”].) 3. Hill, Vazquez, and Margarejo Cases The People cite People v. Hill (2006) 142 Cal.App.4th 770 (Hill) for the proposition that commission of crimes by a lone gang member will satisfy the specific intent prong of the enhancement where the gang member intends to promote and further his own gang-related criminal conduct, and People v. Vazquez (2009) 178 Cal.App.4th 347 (Vazquez) and People v. Margarejo (2008) 162 Cal.App.4th 102 (Margarejo) for the 31. proposition that gangs are benefitted by crimes that elevate their status and intimidate the community at large. We agree with the People that being a lone actor does not necessarily foreclose the jury from finding defendant’s crimes were gang related, and that both demanding respect and intimidating the community can benefit criminal street gangs. Indeed, the prosecutor’s theory in this case was plausible, but the deficiency lies with the absence of facts in evidence supporting that theory, and the cases the People cite for support are readily distinguishable. In Hill, the defendant was convicted of making a criminal threat with an attached gang enhancement. (Hill, supra, 142 Cal.App.4th at p. 772.) Although the defendant acted alone following a traffic collision with the victim, he accused the victim of disrespecting him and specifically referred to his gang by name when he did so. (Ibid.) He later returned to the scene with his girlfriend, they both accused the victim of disrespecting him and threatened her, he touched the gun in his waistband, and he demanded the victim fight his girlfriend. (Ibid.) The gang expert testified regarding the issue of gangs and perceived disrespect, and, on appeal, the defendant did not challenge the jury’s determination that he made the threat for the benefit of the gang to which he belonged. (Id. at pp. 772–773.) Rather, he claimed, unsuccessfully, that the Court of Appeal should follow decisions from the Ninth Circuit Court of Appeals requiring that “the crime [charged in the case] be committed to enable or further other criminal activity by the gang.” (Id. at p. 773.)14 In Margarejo, the defendant was convicted of evading police, being a felon in possession of a firearm, and concealing a firearm in a vehicle, with attached gang 14 The California Supreme Court subsequently rejected the Ninth Circuit’s interpretation of the gang statute and agreed that “‘[t]here is no statutory requirement that this “criminal conduct by gang members” be distinct from the charged offense, or that the evidence establish specific crimes the defendant intended to assist his fellow gang members in committing.’” (Albillar, supra, 51 Cal.4th at p. 66, quoting Vazquez, supra, 178 Cal.App.4th at p. 354 and citing Hill, supra, 142 Cal.App.4th at p. 774.) 32. enhancements. (Margarejo, supra, 162 Cal.App.4th at p. 104.) The defendant ran a stop sign and then led police on an almost 20-minute vehicle chase, throughout which he flashed his gang’s hand sign at police, pedestrians and other vehicles. (Id. at pp. 105– 106.) After stopping his car, the defendant fled on foot into an apartment unit where his good friend and fellow gang member lived, and he stashed his firearm in his friend’s safe. (Id. at p. 106.) Although he admitted his conduct could support a finding that he intended to intimidate the public, he claimed the evidence was insufficient to support the specific intent prong of the gang enhancement. (Id. at p. 110.) The Court of Appeal disagreed, concluding that the defendant’s “uncommon[]” conduct during the highspeed chase (id. at p. 109), which served solely to broadcast a gang message, was sufficient to support the jury’s finding on the specific intent element (id. at p. 110). Finally, in Vazquez, the defendant shot and killed a man who, with his girlfriend, had parked in an alley behind an apartment complex. (Vazquez, supra, 178 Cal.App.4th at pp. 349–350.) The gang expert opined that the crime was committed for the benefit of the defendant’s criminal street gang because it earned the shooter and his gang greater respect and increased status by creating an atmosphere of fear and intimidation. (Id. at p. 351.) In that case, however, the defendant was with two other gang members who encouraged him to shoot the victim, they fled the scene together, other gang members and associates assisted the defendant in evading arrest, the crime occurred in an alley filled with gang graffiti in territory claimed by three rival gangs, the victim was standing near a rival gang’s graffiti that had been defaced by graffiti from the defendant’s gang, and the defendant may have mistaken the victim for a rival gang member based on the victim’s hairstyle and clothing. (Id. at p. 354.) The defendant did not challenge the finding that he committed the crime for the benefit of his gang, but he claimed there was insufficient evidence of the requisite specific intent to promote other criminal activity by gang members. (Vazquez, supra, 178 Cal.App.4th at p. 353.) Vazquez, like Hill, was decided prior to California Supreme 33. Court’s rejection of that specific argument in Albillar, but the Court of Appeal was not persuaded by the Ninth Circuit’s view and concluded that given the circumstances surrounding the crime, the specific intent prong was supported by substantial evidence. (Vazquez, supra, at p. 353.) For the reasons discussed, we find the evidence in the record insufficient to support the jury’s findings that defendant murdered Hollis, shot at an occupied vehicle, and possessed a firearm in association with or for the benefit of CBC, and that defendant acted with the specific intent to promote, further, or assist in criminal conduct by gang members. Accordingly, we reverse the gang enhancements and remand the matter for resentencing. II. Denial of Motion to Bifurcate Gang Enhancements Next, defendant claims that the trial court erred by denying his pretrial motion to bifurcate the gang enhancements from the substantive charges and that the failure to bifurcate the enhancements rendered his trial fundamentally unfair, in violation of his right to due process. We agree with the People that the trial court did not exceed the bounds of its broad discretion when it denied the bifurcation motion and defendant’s trial was not fundamentally unfair. A. Legal Standard “Bifurcation of gang allegations is appropriate where the gang evidence is ‘so extraordinarily prejudicial, and of so little relevance to guilt, that it threatens to sway the jury to convict regardless of the defendant’s actual guilt.’ [Citation.] In a case not involving imposition of the gang enhancement, such ‘evidence of gang membership is potentially prejudicial and should not be admitted if its probative value is minimal.’ [Citation.] On the other hand, ‘evidence of gang membership is often relevant to, and admissible regarding, the charged offense.’ [Citation.] Given the public policy preference for the efficiency of a unitary trial, a court’s discretion to deny bifurcation of a gang allegation is broader than its discretion to admit gang evidence in a case with no 34. gang allegation. [Citation.] Thus, ‘[e]ven if some of the evidence offered to prove the gang enhancement would be inadmissible at a trial of the substantive crime itself … a court may still deny bifurcation.’” (Franklin, supra, 248 Cal.App.4th at p. 952, quoting Hernandez, supra, 33 Cal.4th at pp. 1049–1050; accord, People v. Pettie (2017) 16 Cal.App.5th 23 , 43; People v. Garcia, supra, 244 Cal.App.4th at p. 1357.) “We review the trial court’s denial of the motion to bifurcate for abuse of discretion, based on the record as it stood at the time of the ruling.” (Franklin, supra, 248 Cal.App.4th at p. 952, citing Hernandez, supra, 33 Cal.4th at p. 1048.) “Under the abuse of discretion standard, ‘a trial court’s ruling will not be disturbed, and reversal of the judgment is not required, unless the trial court exercised its discretion in an arbitrary, capricious, or patently absurd manner that resulted in a manifest miscarriage of justice.’” (People v. Hovarter (2008) 44 Cal.4th 983 , 1004; accord, People v. Bryant, Smith and Wheeler (2014) 60 Cal.4th 335 , 390; Franklin, supra, at pp. 952–953.) B. Analysis “‘[E]vidence related to gang membership is not insulated from the general rule that all relevant evidence is admissible if it is relevant to a material issue in the case other than character, is not more prejudicial than probative, and is not cumulative.’ [Citations.] Indeed, gang evidence is ‘relevant and admissible when the very reason for the underlying crime, that is the motive, is gang related.’ [Citation.] ‘“[B]ecause a motive is ordinarily the incentive for criminal behavior, its probative value generally exceeds its prejudicial effect, and wide latitude is permitted in admitting evidence of its existence.”’” (Franklin, supra, 248 Cal.App.4th at p. 953.) Defendant concedes the gang evidence was relevant to explain motive and his actions, and that it had some relevance to the shooter’s identity, but he argues that the “gang evidence was not necessary to explain senseless violence[,]” and “Hollis’s murder was readily explainable [because] he had just shot and killed a man who merely punched him.” The prosecution was entitled to present its theory of the case, however, and 35. defendant’s contrary view of the evidence does not control. (Franklin, supra, 248 Cal.App.4th at p. 953; see People v. Booker (2011) 51 Cal.4th 141 , 171 [“prosecution may present a persuasive and forceful case”]; People v. Roberts (1992) 2 Cal.4th 271 , 299 [introduction of gang evidence unconnected to the defendant not fundamentally unfair where evidence was relevant to prosecutor’s theory and provided jury with context necessary to understand theory].) Although we have determined that the elements of the gang enhancement are not supported by substantial evidence, this finding should not be interpreted to suggest the prosecution’s theory was baseless or the gang evidence was irrelevant to the substantive charges. (Franklin, supra, 248 Cal.App.4th at p. 953.) To the contrary, while the gang evidence did not ultimately add up to enough with respect to the gang enhancement attached to counts 1 through 3, the prosecution theory was neither implausible nor baseless viewed in the context of the evidence, and the evidence was also relevant to the substantive charges and the special-circumstance allegation. (Ibid.) Moreover, following the California Supreme Court’s decision in Sanchez and in the absence of any stipulation between the parties, most gang cases will necessarily involve more gang evidence than did cases pre-Sanchez. (Sanchez, supra, 63 Cal.4th at p. 686 [“Expert cannot … relate as true case-specific facts asserted in hearsay statements, unless they are independently proven by competent evidence or are covered by a hearsay exception.”].) Here, there were no stipulations regarding the gang evidence and, as discussed in greater detail in the next section, the evidence was neither of minimal relevance nor “extraordinarily prejudicial[.]” (Hernandez, supra, 33 Cal.4th at p. 1049; accord, Franklin, supra, 248 Cal.App.4th at p. 952; People v. Garcia, supra, 244 Cal.App.4th at p. 1358.) Additionally, the jury was given the following limiting instruction: “[Y]ou may consider evidence of gang activity only for … the limited purpose of deciding whether the defendant acted with the intent, purpose, 36.  and knowledge … required to prove the gang related crimes, the enhancements, and the special circumstance allegation charged, or the defendant had a motive to commit the crimes charged, or the defendant acted in the heat of passion. [¶] You may also consider this evidence when you evaluate the credibility or believability of a witness and when you consider the facts and information relied on by an expert witness in reaching his or her opinion. You may not consider this evidence for any other purpose. [¶] You may not conclude from this evidence that the defendant is a person of bad character or that he has a disposition to commit crime.” “We presume that the jury followed these limiting instructions, and there is nothing in this record to rebut that presumption.” (Franklin, supra, 248 Cal.App.4th at p. 953.) On these grounds, we reject defendant’s claims both that the trial court abused its discretion in denying his motion to bifurcate the gang enhancements, and that, even if correct at the time the ruling was made, the failure to bifurcate the gang enhancements “‘“actually resulted in ‘gross unfairness’ amounting to a denial of due process.” [Citation.]’” (People v. Pettie, supra, 16 Cal.App.5th at p. 42; accord, United States v. Lane (1986) 474 U.S. 438 , 449; People v. Soper (2009) 45 Cal.4th 759 , 783; cf. Albarran, supra, 149 Cal.App.4th at p. 230, fn. omitted [introduction of “extremely and uniquely inflammatory” gang evidence that “had no legitimate purpose in [the] trial[]” rendered the trial fundamentally unfair].) III. Admission of Rap Videos and Predicate Offenses Involving Defendant Pursuant to Evidence Code section 352, defendant challenges the amount of gang evidence admitted, specifically the number of gang rap videos and predicate offenses. He argues that the tribute video to Tomlin was sufficient to demonstrate Tomlin’s position of respect in the gang, but the 2010 BPD video and the other two videos featuring Tomlin were only minimally relevant, and, even if relevant, were cumulative of other less inflammatory evidence of defendant’s and Tomlin’s gang membership. Defendant also argues that evidence of the two predicate offenses involving his prior crimes should have been excluded given the prosecutor’s introduction of the four predicate offenses 37. involving other gang members. As discussed below, we agree with the People that the trial court’s admission of this evidence was not an abuse of discretion. A. Evidence Code Section 352 Under California law, evidence is relevant if it has “any tendency in reason to prove or disprove any disputed fact that is of consequence to the determination of the action[]” (Evid. Code, § 210), and all relevant evidence is admissible except as otherwise provided by statute (Evid. Code, § 351). At issue here, Evidence Code section 352 provides, “The court in its discretion may exclude evidence if its probative value is substantially outweighed by the probability that its admission will (a) necessitate undue consumption of time or (b) create substantial danger of undue prejudice, of confusing the issues, or of misleading the jury.” However, “‘“[p]rejudice” as contemplated by [Evidence Code] section 352 is not so sweeping as to include any evidence the opponent finds inconvenient. Evidence is not prejudicial, as that term is used in a section 352 context, merely because it undermines the opponent’s position or shores up that of the proponent. The ability to do so is what makes evidence relevant. The code speaks in terms of undue prejudice. Unless the dangers of undue prejudice, confusion, or time consumption “‘substantially outweigh’” the probative value of relevant evidence, a section 352 objection should fail. [Citation.] “‘The “prejudice” referred to in Evidence Code section 352 applies to evidence which uniquely tends to evoke an emotional bias against the defendant as an individual and which has very little effect on the issues. In applying section 352, “prejudicial” is not synonymous with “damaging.”’ [Citation.]” [Citation.] [¶] The prejudice that section 352 “‘is designed to avoid is not the prejudice or damage to a defense that naturally flows from relevant, highly probative evidence.’ [Citations.] ‘Rather, the statute uses the word in its etymological sense of “prejudging” a person or cause on the basis of extraneous factors. [Citation.]’ [Citation.]” [Citation.] In other words, evidence should be excluded as unduly prejudicial when it is of such nature as to inflame the 38. emotions of the jury, motivating them to use the information, not to logically evaluate the point upon which it is relevant, but to reward or punish one side because of the jurors’ emotional reaction. In such a circumstance, the evidence is unduly prejudicial because of the substantial likelihood the jury will use it for an illegitimate purpose.’” (People v. Doolin (2009) 45 Cal.4th 390 , 438–439; accord, People v. Bell (2019) 7 Cal.5th 70 , 105; People v. Tran (2011) 51 Cal.4th 1040 , 1048 (Tran).) B. Standard of Review On appeal, we presume the trial court’s evidentiary ruling is correct and defendant bears the burden of demonstrating error. (People v. Giordano (2007) 42 Cal.4th 644 , 666; People v. Anthony (2019) 32 Cal.App.5th 1102 , 1139–1140.) “The trial court enjoys broad discretion in determining the relevance of evidence and in assessing whether concerns of undue prejudice, confusion, or consumption of time substantially outweigh the probative value of particular evidence. [Citation.] ‘The exercise of discretion is not grounds for reversal unless[, as set forth previously,] “‘the court exercised its discretion in an arbitrary, capricious or patently absurd manner that resulted in a manifest miscarriage of justice.’”’” (People v. Clark (2016) 63 Cal.4th 522 , 572; accord, People v. Johnson (2019) 8 Cal.5th 475 , 521; People v. Jackson (2016) 1 Cal.5th 269 , 320–321.) C. Analysis 1. Rap Videos a. Background In this case, the court excluded one gang rap video, but admitted four others. One of four videos was filmed in 2010 after the funeral of Avila and included defendant, who flashed a gang hand sign and called out, “‘fuck Stratton[.]’” The other three videos featured Tomlin. Defendant concedes the Tomlin tribute video was relevant to show Tomlin’s status in the gang, but he argues that the 2010 BPD video and the other two videos featuring Tomlin “were merely cumulative of ample evidence that established [defendant] and Tomlin were gang members and were irrelevant since the charged crime 39. did not involve an inexplicable act of violence that could only be reasonably explained by gang evidence.” We agree with the People that the videos were probative of defendant’s and Tomlin’s active ties to CBC; Tomlin’s stature in the gang; and, more generally, the existence of the gang itself in terms of numerous participants, its association with the color powder blue, the use of certain hand signs, and geographic locations with historical significance to the gang. As well, the videos were relevant to the prosecution’s theory that defendant, an active CBC gang member, killed Hollis after he gunned down Tomlin, who was an older, respected CBC member, and the videos aided the prosecutor in tying the gang evidence together, as the evidence was necessarily elicited piecemeal in accordance with Sanchez. We acknowledge defendant’s citation to People v. Cardenas (1982) 31 Cal.3d 897 , 904–905 and People v. Maestas (1993) 20 Cal.App.4th 1482 , 1499 for support, but find reliance on those decisions misplaced given that both involved the admission of gang evidence for the limited purpose of demonstrating the bias of defense witnesses. Here, the gang evidence was relevant to the substantive charges, the gang enhancement attached to counts 1 through 3, and the gang special-circumstance allegation attached to the murder charge. Unlike evidence of prior uncharged misconduct admitted under Evidence Code section 1101, subdivision (b), to establish an intermediary fact, gang evidence introduced in a prosecution for a substantive gang offense or gang-related felonies “provides direct proof of several ultimate facts necessary to a conviction.” (Tran, supra, 51 Cal.4th at p. 1048.) Therefore, the probative value of such evidence in a gang case is generally greater and its prejudicial effect generally less. (Ibid.) b. Coneal Decision We find the Court of Appeal’s decision in People v. Coneal (2019) 41 Cal.App.5th 951 (Coneal), which was issued after briefing was complete in this case, helpful. In Coneal, the appellate court considered the admission of five gang rap videos. (Id. at 40. p. 953). The court found “the rap videos had minimal probative value, either because they were cumulative of other, less prejudicial evidence, or because their probative value depended on construing the lyrics as literal statements of fact or intent without a persuasive basis to do so[,]” and “[t]his minimal probative value was substantially outweighed by the highly prejudicial nature of the violent, inflammatory lyrics .…” (Id. at pp. 953–954.) The court concluded the admission of the videos was an abuse of discretion under Evidence Code section 352, but the error was harmless under state law and it did not render the defendant’s trial fundamentally unfair, in violation of due process. (Coneal, supra, at pp. 971–973.) Given the potentially highly inflammatory nature of gang rap videos, we agree with the court in Coneal that trial courts must be cautious in evaluating such videos, particularly “where the rap lyrics are cumulative of other evidence, like screenshots, or where the probative value rests on construing the lyrics literally without a persuasive basis to do so .…” (Coneal, supra, 41 Cal.App.5th at pp. 971–972.) However, the concerns that informed the court’s decision in Coneal are not present here. The defendant in Coneal was a gang member who was convicted of first degree murder in the shooting death of a rival gang member. (Coneal, supra, 41 Cal.App.5th at pp. 954–955.) The two gangs had a longstanding, violent rivalry (id. at p. 954), and it appears the prosecutor initially sought to introduce 12 rap videos and an audio recording of the defendant rapping from jail (id. at pp. 960–963 & fn. 10). Ultimately, eight videos and the audio recording were introduced at trial, and the defendant challenged the admission of five videos. (Id. at pp. 953, 960–963.) There was no dispute the five videos were relevant, but the appellate court agreed the videos were cumulative. (Coneal, supra, 41 Cal.App.5th at p. 966.) The prosecutor introduced the videos as evidence of the gang membership of the defendant and the individuals who committed the predicate offenses; as evidence of the prominence of a specific gang “‘figurehead[,]’” which in turn explained the defendant’s tattoo of that 41. individual; and as evidence of the rivalry between the two gangs. (Id. at pp. 966–967.) However, as to each of these points, the appellate court found the probative value of the videos to be minimal given that the prosecutor introduced numerous screenshots from the videos, additional photographs, and witness testimony, including by two gang experts, that established each of these points. (Id. at pp. 966–967.)15 The court concluded, “[T]here was a substantial amount of other probative evidence as to several purposes for which the People introduced the rap videos. This other evidence, including screenshots from the videos, rendered the additional probative value of the videos for these purposes minimal. In fact, the only new ‘information’ provided by the videos is the lyrics, and the lyrics are the problem.” (Id. at pp. 967–968.) The prosecutor treated the rap lyrics as literal with respect to fact and intent, which the court found problematic on that record. (Coneal, supra, 41 Cal.App.5th at p. 968.) The court explained, “We do not mean to suggest that lyrics are never probative of their literal truth[]” (id. at p. 969), and “[w]e do not purport to provide an exhaustive list of factors that may increase the probative value of lyrics as statements of literal fact or intent. It is sufficient that no such factors were present here to increase the probative value of the rap lyrics as evidence that the [gang’s] primary activities were the list of felonies rapped by appellant; that appellant had or intended to kill rival gang members, catch victims by surprise, and engage in driveby shootings; or that the [gang’s] rappers committed or intended to commit the various heinous crimes they rapped about[]” (id. at pp. 969–970, italics added). Further, the rap songs included “lyrics casually describ[ing] graphic, widespread violence[]” (id. at p. 970), and “misogynistic lyrics … [that] were highly inflammatory[]” (id. at p. 971). 15 The evidence in Coneal included more than 100 cumulative photographs, including more than 30 screenshots from the rap videos. (Coneal, supra, 41 Cal.App.5th at pp. 963–964.) 42.  In our view, the three videos challenged here stand in stark contrast with the five videos challenged in Coneal. Although Coneal did not purport to speak to number, it bears repeating that the prosecutor in Coneal introduced eight videos and a recording, while the prosecutor in this case introduced only four videos. Critically, unlike in Coneal, the prosecutor here did not introduce extensive testimony regarding the videos, did not also introduce multiple screenshots from the videos, and did not dwell on the lyrics as literal evidence of facts or intent. As discussed next, the videos here are neither minimally probative nor unduly cumulative. c. 2010 BPD Video With respect to the 2010 BPD video, Deputy Colbert very briefly and without elaboration described seizing the video from a memory card during his search of Donnell Robinson, and he identified two individuals—Donnell Robinson and Tyrone James—in the video. The video was subsequently played in full during Lieutenant Stratton’s testimony, and the prosecutor elicited specific testimony from Stratton regarding two parts in the video. As to those parts, Stratton, who was in the gang unit in 2010, identified defendant, described defendant’s hand movements as consistent with CBC gang signs, and testified defendant said, “‘fuck Stratton[.]’” Finally, Detective Pair testified thereafter that the video factored into his opinion that defendant was an active participant in CBC based on defendant’s shirt, which memorialized Avila against a powder blue background; defendant’s gang hand signs; and defendant’s call out to a specific officer in the gang unit. Pair also noted in separate testimony that the video was filmed in the same cul-de-sac as featured in one of the Tomlin videos. In total, the testimony of these three witnesses amounted to only five pages in the transcript, and while the lyrics were unquestionably profane and directed toward BPD, the prosecutor did not address them other than defendant’s call out to Stratton. Detective Pair also stated that the lyrics were not of any specific value to him given that the participants were upset over the officer-involved shooting death of Avila. The video 43. otherwise featured a large CBC-related gathering in a cul-de-sac that included women and children and did not include weapons, acts of violence, or criminal acts. The prosecutor’s theory of liability hinged on demonstrating that defendant and Tomlin were sufficiently active in the gang, and Tomlin in a position of such respect, that defendant instantly sought to avenge Tomlin’s death not as a friend but as a fellow gang member. The prosecutor had other evidence of defendant’s gang participation in the form of an admission from 2011, a letter from 2013, tattoos, gang-related clothing in 2014, a photograph from 2015, two admissions from 2016, and a photograph of defendant with Pink in 2018. The prosecutor also introduced evidence from a room search in 2013 and evidence of defendant’s two convictions, although defendant was not the sole occupant of the bedroom and his convictions did not include gang charges. However, in Tran, the California Supreme Court rejected the argument “that the prosecution must forgo the use of relevant, persuasive evidence to prove an element of a crime because the element might also be established through other evidence[,]” and stated, “[T]he prosecution cannot be compelled to ‘“present its case in the sanitized fashion suggested by the defense.”’” (Tran, supra, 51 Cal.4th at p. 1049.) Thus, defendant is not entitled to a presentation of gang evidence stripped down to the barest of bones (ibid.), and the video was probative of the level of defendant’s engagement in gang activities, the length of that engagement—2010 to 2018—and the gang’s culture and associations. This is not a case where the other evidence was so substantial that the video had only minimal probative value (Coneal, supra, 41 Cal.App.5th at pp. 967–968), or where the prosecutor was toeing the line of “‘over-prov[ing]’” its case (People v. Williams (2009) 170 Cal.App.4th 587 , 610 (Williams). Under the circumstances here, we find no abuse of discretion in admitting the 2010 BPD video, which was probative of defendant’s active participation in the gang and neither unduly inflammatory nor unduly cumulative. (People v. Olguin (1994) 31 Cal.App.4th 1355 , 1373 [“The mere fact the [rap] lyrics might be interpreted as reflective of a generally violent attitude could not be 44. said ‘substantially’ to outweigh their considerable probative value.”]; accord, People v. Zepeda (2008) 167 Cal.App.4th 25 , 34–35 [no abuse of discretion in admitting two gangster rap songs].) d. Tomlin Videos The trial court excluded one video featuring Tomlin. The other three videos were offered to show that Tomlin was an active participant in CBC, despite being in his early 40’s at the time of his death, and that he held a position of seniority and respect. In addition, the prosecutor relied on the videos to demonstrate gang culture more generally, including certain geographic locations of historical importance that were discussed in the context of other gang contacts. Tomlin was linked to CBC through one “ESK” gang tattoo; one photograph that included mention of his gang moniker, “GLOCC 99”; one photograph of him making a “Feliz[]” sign with his hand; one photograph of him with Donnell Robinson and Gregory Miller, both of whom had some association with CBC; and the three videos.16 Other than the videos, the evidence linking Tomlin to gang activity was not particularly strong and it did not specifically tie him to CBC. Therefore, the three videos were highly probative of his active participation in CBC and his position of seniority, they were not cumulative of the other strong evidence, and testimony regarding the videos comprised only 16 pages of the transcript. The rap lyrics themselves are laden with profanity and describe acts of violence, but we do not find them to be unduly inflammatory: they are not exceptionally graphic and, with the exception of a nongraphic shooting scene in the tribute video that was excerpted from a movie, the videos do not feature weapons; they do not include any irrelevant, misogynistic acts or lyrics; and, as the People point out, they do not depict any 16 The significance of “Feliz” was not explained, but Detective Pair testified that CBC members identify with subsets based on streets or other geographic areas. 45. criminal acts. (Coneal, supra, 41 Cal.App.5th at pp. 970–971; People v. Zepeda, supra, 167 Cal.App.4th at pp. 34–35; People v. Olguin, supra, 31 Cal.App.4th at p. 1373.) Moreover, while the specific lyrics highlighted by the prosecutor included references to shootings and firearms, they were selected to show the rivalry between ESC and CBC generally, CBC’s focus on its history, and the express reference to Tomlin in the tribute video. In sum, we find the Tomlin videos had significant relevance, and defendant fails to persuade us that the probative value was substantially outweighed by the danger of undue prejudice. (Tran, supra, 51 Cal.4th at pp. 1048–1049.) 2. Predicate Offenses Next, the prosecution was required to prove the existence of a “‘criminal street gang’” as defined in section 186.22, subdivision (f). In relevant part, this required the prosecution to show the commission of at least two qualifying predicate offenses for the purpose of establishing a “‘pattern of gang criminal activity[.]’” (Id., subd. (e).) The prosecutor introduced evidence of six predicate offenses, two of which involved defendant. Defendant claims evidence of his past crimes should have been excluded as cumulative and unduly prejudicial. We disagree. Defendant cites no authority supporting his position regarding a limit either on the number of predicate offenses or on the admission of predicate offenses in which he was involved. In People v. Hill (2011) 191 Cal.App.4th 1104 , 1139, the Court of Appeal rejected a similar argument. The prosecutor in People v. Hill sought to introduce evidence of 10 predicate offenses and the trial court permitted eight. (Id. at pp. 1137– 1138.) On review, the appellate court evaluated the admission of the eight predicate offenses through the lens of Williams, supra, 170 Cal.App.4th at pages 608–611. (People v. Hill, supra, at p. 1139.) In Williams, the trial court admitted evidence of at least eight predicate offenses and held the view that “‘the [district attorney] is entitled to the full force of their evidence. If they want to over-prove their case or put on all the evidence that they have, 46. that’s their right.’” (Williams, supra, 170 Cal.App.4th at p. 610.) The Court of Appeal stated, “We strongly disagree with the view that prosecutors have any right to ‘over- prove their case or put on all the evidence that they have.’” (Ibid.) “[N]either the prosecution nor the defendant has a right to present cumulative evidence that creates a substantial danger of undue prejudice [citation] or that unduly consumes the court’s time [citation].” (Id. at p. 611.) The court concluded “it was an abuse of discretion to admit cumulative evidence concerning issues not reasonably subject to dispute. The sheer volume of evidence extended the trial—and the burden on the judicial system and the jurors—beyond reasonable limits, and the endless discussions among the trial court and counsel concerning the admissibility of such evidence amounted to a virtual street brawl.” (Ibid.) In People v. Hill, the appellate court distinguished Williams, explaining, “We do not read Williams to create an artificial limit of seven (or fewer) predicate offenses to prove the gang enhancement. The trial court here exercised its discretion and eliminated two offenses the prosecution sought to introduce. This ruling created neither a ‘street brawl’ nor ‘endless discussions.’ No error occurred.” (People v. Hill, supra, 191 Cal.App.4th at p. 1139; accord, People v. Rivas (2013) 214 Cal.App.4th 1410 , 1435– 1436 [admission of six predicate offences not error].) In this case, as previously stated, the gang evidence was relevant to the substantive charges, the gang enhancements, and the gang special-circumstance allegation. The trial court evaluated the evidence; found that the predicate offenses, which occurred between 2012 and 2016, were relevant to show a pattern of criminal activity; and that as to defendant, the prior convictions did not involve “repetitive” homicides or shootings at an occupied vehicle and were less inflammatory than the charges in the case. The court concluded that the probative value outweighed any prejudicial impact. Unlike in Williams, the trial court here did not hold the view that the prosecution had the right “‘to over-prove [its] case[,]’” and the evidence was not unduly cumulative. (Williams, supra, 170 Cal.App.4th at p. 610 [prosecutor 47. spent almost two full days on evidence that was a repeat of previous evidence].) Accordingly, we find no error. IV. Admission of Photographs of Hollis’s Body Defendant claims that the trial court erred under Evidence Code section 352 when it admitted photographs showing Hollis’s body inside his vehicle, and that admission of the photographs also violated his right to due process. He argues the photographs had no relevance given the absence of any dispute as to how Hollis died, and to the extent Hollis’s wounds had minimal relevance, the crime scene photographs were cumulative of the autopsy photographs. We find no merit to this claim. It is well settled that “‘[a]t base, the applicable rule is simply one of relevance, and the trial court has broad discretion in determining such relevance. [Citation.] “‘[M]urder is seldom pretty, and pictures, testimony and physical evidence in such a case are always unpleasant’” [citation], and we rely on our trial courts to ensure that relevant, otherwise admissible evidence is not more prejudicial than probative (Evid. Code, § 352). A trial court’s decision to admit photographs under Evidence Code section 352 will be upheld on appeal unless the prejudicial effect of such photographs clearly outweighs their probative value.’” (People v. Lewis (2009) 46 Cal.4th 1255 , 1282, quoting People v. Gurule (2002) 28 Cal.4th 557 , 624; accord, People v. Powell (2018) 6 Cal.5th 136 , 163– 164.) “‘To determine whether there was an abuse of discretion, we address two factors: (1) whether the photographs were relevant, and (2) whether the trial court abused its discretion in finding that the probative value of each photograph outweighed its prejudicial effect.’” (People v. Lewis, supra, at p. 1282, quoting People v. Whisenhunt (2008) 44 Cal.4th 174 , 211–212; accord, People v. Peoples (2016) 62 Cal.4th 718 , 748.) The prosecutor introduced five photos of Hollis’s body taken from different angles, but, as the trial record reflects and our review confirms, the first photo is so dark that Hollis’s body is not readily discernible. Of the other four photos, none is excessively bloody and only one clearly shows a bullet wound. Although the photographs show 48. Hollis shot to death, we do not find them unusually gruesome and they are not unduly cumulative. Defendant’s argument that the photographs are irrelevant because the circumstances of Hollis’s death were not in dispute lacks force. “‘Photographs of a murder victim “are always relevant to prove how the charged crime occurred, and the prosecution is ‘not obliged to prove these details solely from the testimony of live witnesses,’” even in the absence of a defense challenge to particular aspects of the prosecution’s case.’” (People v. D’Arcy (2010) 48 Cal.4th 257 , 299; accord, People v. Booker, supra, 51 Cal.4th at p. 170; People v. Lewis, supra, 46 Cal.4th at p. 1282.) Here, the prosecutor had a right to show the jury Hollis’s body as it was found at the crash site and the evidence was relevant to the manner of death; what Hollis looked like and what he was wearing given the various witness accounts and surveillance camera footage introduced into evidence; to corroborate various witnesses’ testimony, including that Hollis was shot through the driver’s side door; and to aid the jury in evaluating witness credibility. (People v. Morales (2020) 10 Cal.5th 76 , 103–104 [“‘[P]hotographs are [not] irrelevant or inadmissible simply because they duplicate testimony, depict uncontested facts, or trigger an offer to stipulate.’”]; accord, People v. Scheid (1997) 16 Cal.4th 1 , 14–17.) We conclude the four photographs were relevant and “‘are not of such a nature as to overcome the jury’s rationality.’” (People v. Lewis, supra, 46 Cal.4th at p. 1282, quoting People v. Whisenhunt, supra, 44 Cal.4th at p. 212.) We find no error, and “[p]roper admission [of the photographs under state law] vitiates [the] defendant’s constitutional claim.” (People v. Winbush (2017) 2 Cal.5th 402 , 458.) V. Cumulative Error Defendant claims that cumulatively, the errors committed by the trial court resulted in prejudice to him. “In examining a claim of cumulative error, the critical question is whether [the] defendant received due process and a fair trial. [Citation.] A predicate to a claim of cumulative error is a finding of error.” (People v. Sedillo (2015) 235 Cal.App.4th 1037 , 1068.) We have rejected defendant’s individual claims of error 49. and, therefore, his claim of cumulative error necessarily fails. (People v. Williams (2013) 56 Cal.4th 165 , 201, disapproved on another ground by People v. Elizalde, supra, 61 Cal.4th at p. 538, fn. 9; People v. Sedillo, supra, at p. 1068; People v. Leeds (2015) 240 Cal.App.4th 822 , 837.) VI. Senate Bill No. 1393 Finally, effective January 1, 2019, Senate Bill No. 1393 amended sections 667, former subdivision (a)(1), and 1385, former subdivision (b), and granted trial courts the discretion to strike the previously mandatory five-year prior serious felony conviction enhancement under section 667, subdivision (a)(1). The parties agree that Senate Bill No. 1393 applies retroactively to this case, but they disagree whether remand is required. The People take the position that remand would be futile because the trial court’s comments and sentencing choices clearly indicate it would not have dismissed the prior serious felony conviction enhancement even if it had the discretion to do so at the time of sentencing. “[W]e presume that newly enacted legislation mitigating criminal punishment reflects a determination that the ‘former penalty was too severe’ and that the ameliorative changes are intended to ‘apply to every case to which it constitutionally could apply,’ which would include those ‘acts committed before its passage[,] provided the judgment convicting the defendant of the act is not final.’ ([In re] Estrada [(1965)] 63 Cal.2d [740,] 745 [(Estrada)].) The Estrada rule rests on the presumption that, in the absence of a savings clause providing only prospective relief or other clear intention concerning any retroactive effect, ‘a legislative body ordinarily intends for ameliorative changes to the criminal law to extend as broadly as possible, distinguishing only as necessary between sentences that are final and sentences that are not.’” (People v. Buycks (2018) 5 Cal.5th 857 , 881; accord, People v. Frahs (2020) 9 Cal.5th 618 , 634 [“[I]n order to rebut Estrada’s inference of retroactivity concerning ameliorative statutes, the Legislature must 50. ‘demonstrate its intention with sufficient clarity that a reviewing court can discern and effectuate it.’”].) Courts of Appeal considering Senate Bill No. 1393 and, in an analogous context, Senate Bill No. 620, have uniformly held that the changes apply retroactively to judgments not yet final on appeal. (E.g., People v. Zamora (2019) 35 Cal.App.5th 200 , 207–208 [Sen. Bills Nos. 620 and 1393]; People v. Garcia (2018) 28 Cal.App.5th 961 , 972–973 [Sen. Bill No. 1393]; People v. Chavez (2018) 22 Cal.App.5th 663 , 711–712 [Sen. Bill No. 620]; People v. Arredondo (2018) 21 Cal.App.5th 493 , 506–507 [Sen. Bill No. 620].) As Senate Bill No. 1393 does not contain a savings clause and there is no indication that the Legislature intended any limitation on its retroactive application, we agree with the parties that it applies to this case in accordance with the Estrada rule. Regarding entitlement to remand, “‘“[d]efendants are entitled to sentencing decisions made in the exercise of the ‘informed discretion’ of the sentencing court. [Citations.] A court which is unaware of the scope of its discretionary powers can no more exercise that ‘informed discretion’ than one whose sentence is or may have been based on misinformation regarding a material aspect of a defendant’s record.” [Citation.] In such circumstances, we have held that the appropriate remedy is to remand for resentencing unless the record “clearly indicate[s]” that the trial court would have reached the same conclusion “even if it had been aware that it had such discretion.”’” (People v. Flores (2020) 9 Cal.5th 371 , 431–432, quoting People v. Gutierrez (2014) 58 Cal.4th 1354 , 1391; accord, People v. Johnson (2019) 32 Cal.App.5th 26 , 69; People v. Almanza (2018) 24 Cal.App.5th 1104 , 1110–1111.) However, remand is not required when it would be an idle act. (People v. Flores, supra, at p. 432, citing People v. McDaniels (2018) 22 Cal.App.5th 420 , 425; accord, People v. Jefferson (2019) 38 Cal.App.5th 399 , 409; People v. Allison (2019) 39 Cal.App.5th 688 , 705–706.) We conclude it is unnecessary to resolve the parties’ dispute regarding whether remand would be futile on the sentencing record in this case. Because the matter must be 51. remanded for resentencing given reversal of the gang enhancements, the issue is moot. On remand, defendant may request the trial court consider granting him relief pursuant to Senate Bill No. 1393. DISPOSITION As to counts 1 through 3, the gang enhancement findings under section 186.22, subdivision (b)(1), are reversed and this matter is remanded for resentencing. Following resentencing, the trial court shall forward an amended abstract of judgment to the appropriate authorities. Except as modified, the judgment is affirmed. MEEHAN, J. WE CONCUR: PEÑA, Acting P.J. DeSANTOS, J. 52.

2012-04-17 22:06:07+00

http://bulk.resource.org/courts.gov/c/F3/124/124.F3d.215.96-17290.html

124 F.3d 215 NOTICE: Ninth Circuit Rule 36-3 provides that dispositions other than opinions or orders designated for publication are not precedential and should not be cited except when relevant under the doctrines of law of the case, res judicata, or collateral estoppel. Ray WATSON, Plaintiff-Appellant, v. William SZCZEPANIAK; Las Vegas Valley Water District, Defendants-Appellees. No. 96-17290. United States Court of Appeals, Ninth Circuit. Submitted Sept. 8, 1997.** Decided Sept. 12, 1997. Appeal from the United States District Court for the District of Nevada, No. CV-95-00189-LDG/RJJU; Lloyd D. George, District Judge, Presiding. Before: HALL, BRUNETTI, and THOMAS, Circuit Judges. 1 MEMORANDUM* 2 Ray Watson appeals pro se the district court's summary judgment in favor of defendants in his 42 U.S.C. § 1983 action alleging that his constitutional rights were violated when he was terminated from the position of water enforcement officer for the Las Vegas Valley Water District. We have jurisdiction pursuant to 28 U.S.C. § 1291, and we affirm.1 3 Watson contends that the district court erred by granting defendants' motion for a protective order prohibiting the depositions of county commissioners and the water district's general manager. We review the district court's rulings concerning discovery for abuse of discretion. See Brown Bag Software v. Symantec Corp., 960 F.2d 1465, 1469 (9th Cir.1992). Watson failed to allege that the commissioners or the district manager had any personal information relevant to his case. Accordingly, the district court did not abuse its discretion in granting the protective order. See id. 4 Watson contends that the district court erred by dismissing his first cause of action, consisting of claims arising from his termination and post-termination hearing. The district court's dismissal of these claims pursuant to Fed.R.Civ.P. 12(b)(6) will be upheld only if the plaintiff would be entitled to no relief under any set of facts that could be proven. See Jones v. Community Redevelopment Agency, 733 F.2d 646, 648-49 (9th Cir.1984). 5 To the extent that Watson's claims of violation of his constitutional rights arise from his termination, the district court correctly dismissed them as barred by the relevant statute of limitations, see Wilson v. Garcia, 471 U.S. 261, 276 (1985); Nev.Rev.Stat. § 11.190(4)(e). 6 However, Watson also claimed violations of his rights to procedural and substantive due process arising from his post-termination hearing, which were not barred by the statute of limitations. See Wilson v. Garcia, 471 U.S. 261, 276 (1985); Nev. Rev. Stat. § 11.190(4)(e). Nevertheless, because Watson did not allege facts implicating the violation of a fundamental right, and defendants' decision to terminate him was at least rationally related to a legitimate governmental interest, he failed to make out a claim for violation of his substantive due process rights. See Wedges/Ledges of Cal., Inc. v. City of Phoenix, 24 F.3d 56, 66 (9th Cir.1994). 7 Watson also alleged that the employer-appointed hearing officer at his post-termination hearing was biased, violating his right to procedural due process. Watson was a public employee with a due process property right in his employment. See Sweikert v. Briare, 588 P.2d 542, 544 (Nev.1978). Because Watson failed to allege sufficient facts showing personal or institutional bias on the part of the hearing officer, the district court did not err in dismissing this claim under Fed.R.Civ.P. 12(b)(6). See Jordan v. City of Lake Oswego, 734 F.2d 1374, 1376 & n. 1 (9th Cir.1984). 8 Watson contends that the district court erred by granting defendant Donnelly's motion to dismiss. Watson's federal claims against defendant Donnelly were barred under Nevada's two-year statute of limitations. See Nev.Rev.Stat. § 11.190(4)(e). Accordingly, the district court did not err by dismissing these claims. See id, 9 Watson contends that the district court erred by refusing to permit him to file a second amended complaint after the defendants had already filed responsive pleadings. We review for abuse of discretion the district court's denial of leave to amend the pleadings after a responsive pleading has been filed. See Jones, 733 F.2d at 650. Watson failed to comply with the district court's local rules in his motions to amend his complaint. See D. Nev. Local R. 140-3. Accordingly, the district court did not abuse its discretion by denying them. See Ghazali v. Moran, 46 F.3d 52, 54 (9th Cir.1995) (per curiam). 10 Watson contends that the district court erred by imposing sanctions on him for failing to attend a scheduled deposition. We review the court's imposition of sanctions for failure to comply with discovery for abuse of discretion. See United Artist Corp. & L.P.A.A. v. La Care Aux Folles, Inc., 771 F.2d 1265, 1270 (9th Cir.1985). Watson received notice of the sanctions and opportunity to respond before they were imposed. Moreover, the district court had good cause to impose the sanctions in light of Watson's refusal to cooperate with defendants' attempts to take his deposition. Watson's arguments that sanctions were inappropriate because the court allegedly failed to issue a scheduling order are inapposite. Accordingly, the district court did not abuse its discretion in imposing the sanctions on Watson. See id. 11 Watson contends that the district court erred by granting defendants' summary judgment motion on Watson's claim that defendants' failure to reveal certain evidence to Watson during his termination process constituted a violation of his due process rights, and erred by granting defendants summary judgment on Watson's pendent state claim. We review the grant of summary judgment de novo. See Jesinger v. Nevada Fed. Credit Union, 24 F.3d 1127, 1130 (9th Cir.1994). Watson failed to show that the withholding of the March 5, 1993 letter from the city attorney's office, and his inability to cross-examine the author of the letter, affected his opportunity to be heard at a meaningful time and in a meaningful manner. See Mathews v. Eldridge, 424 U.S. 319, 333 (1976). Accordingly, the district court did not err by dismissing this claim. See Jesinger, 24 F.3d at 1130. AFFIRMED.2 ** The panel unanimously finds this case suitable for decision without oral argument. See Fed. R.App. P. 34(a); 9th Cir. R. 34-4 * This disposition is not appropriate for publication and may not be cited to or by the courts of this circuit except as provided by 9th Cir. R. 36-3 1 We may affirm on any grounds supported by the record. See Granite State Ins. Co. v. Smart Modular Techs., Inc., 76 F.3d 1023, 1026 (9th Cir.1996) 2 We decline to address Watson's contentions regarding Richard Wimmer as they are raised for the first time on appeal. See Brogan v. San Mateo County, 901 F.2d 762, 765 (9th Cir.1990)

2020-12-02 00:02:10.711266+00

https://www.courts.ca.gov/opinions/nonpub/E073264.PDF

Filed 12/1/20 P. v. Sambrano CA4/2 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, E073264 v. (Super.Ct.No. INF1600826) OSCAR FERNANDO SAMBRANO, OPINION Defendant and Appellant. APPEAL from the Superior Court of Riverside County. Jeffrey Prevost, Judge. Affirmed. Richard L. Fitzer, under appointment by the Court of Appeal, for Defendant and Appellant. Xavier Becerra, Attorney General, Lance E. Winters, Chief Assistant Attorney General, Julie L. Garland, Assistant Attorney General, Robin Urbanski and Yvette M. Martinez, Deputy Attorneys General, for Plaintiff and Respondent. 1  Oscar Fernando Sambrano physically abused his former girlfriend numerous times during their relationship. In May 2016, Sambrano struck her on the side of the face. The blow caused her severe pain, ringing in the ear, and hearing loss for several days. She didn’t seek medical attention because she didn’t want to be asked how she got the injury. Several years later, she still had difficulty hearing. Based on this incident of abuse, a jury convicted Sambrano of felony domestic violence and found he had inflicted great bodily injury—a sentencing enhancement which cost him an additional four years in prison. Sambrano argues we should reverse the enhancement because there was insufficient evidence to support the jury’s finding he inflicted great bodily injury. Specifically, he argues the prosecution was required to put on medical evidence regarding the injury. We conclude medical evidence is not required, and the evidence, including the girlfriend’s testimony, was a sufficient basis for the jury to find she suffered a great bodily injury. We therefore affirm the judgment. I FACTS Sambrano and Jane Doe were in a relationship until June 2016. They lived together starting in 2014. Jane’s daughter, Mary, who was born in 2002, lived with them for some of this time. According to Jane, Sambrano often became violent with her, and he sometimes did so in front of Mary. Jane put the number of abusive incidents at more than 100 over the years. 2  Jane first reported the abuse to police in July 2014, when Sambrano beat her with his fists and a wooden broom he swung like a baseball bat. Jane said he had abused her on earlier occasions, but she didn’t report them because Sambrano had promised he would change. Based on the July 2014 incident, Sambrano was convicted of domestic violence, and the court issued a three-year domestic violence protective order. It didn’t work. Sambrano moved back in and in May 2015 assaulted Jane so badly on two occasions that she lost consciousness. The first time, she was washing clothes in the garage and they started arguing about her leaving. Sambrano came at Jane and hit her. Jane fell and her head struck their washing machine, causing her to lose consciousness. She woke up naked in Sambrano’s bed the next day with no memory of how she got there. She had a big bump on her head, which caused her a lot of pain. Later the same month, Sambrano attacked her again when Jane confronted him about his treatment of her daughter. He struck her repeatedly and then grabbed her by the hair and hit her head against a block wall. He then pushed her onto the bed and continued hitting her. Jane fought back, but Sambrano choked her until she lost consciousness. She didn’t report either incident to the police. She said she was afraid Sambrano would do something to her or her family. At trial, Sambrano denied ever hitting Jane. Though he pled guilty to domestic violence in 2014, he said he did so only to get the case over with. He said the incident with the broom occurred after they had an argument and Jane threw a bottle of perfume at him. He used a broom to sweep up the broken pieces but denied hitting her. He denied 3 striking Jane’s head on a washing machine and knocking her unconscious. He also denied choking her. A year later, in May 2016, Sambrano and Jane were arguing about paying bills when he hit her on the right side of her face, near her ear. Jane said she experienced a lot of pain and lost hearing in her right ear. She heard a beeping and a ringing sound and couldn’t hear at all for days. She told Sambrano she wanted to go to the hospital, but he told her she couldn’t go because doctors would ask her what had caused the injury. Jane assured him she wouldn’t tell them what happened and he allowed her to leave. Instead of going to the hospital, however, Jane took her daughter to a hotel so they would be safe. At trial, in April 2019, Jane said she still heard the beeping sound in her ear and experienced difficulty hearing. Mary testified she had seen her mother’s right ear covered with a white rag with tape around it and had heard her complain of difficulty hearing. She said Jane told her she had fallen down, but she didn’t believe her mother. She said she knew Sambrano had hit her mother based on the abuse she had witnessed. In a police interview, Sambrano admitted he had slapped Jane with an open hand on the side of the face near her ear. He confirmed Jane complained of the injury to her ear, and said she went to the hospital to receive treatment. At trial, he testified Jane arrived at their apartment intoxicated that night, and they had argued over his dating other women. He said Jane slapped him and he defended himself. He said his fingertips “just barely touched” her jaw. He said she hadn’t complained of ear pain at the time, but a few 4 days later told him she was going to the hospital. Sambrano said he bought medical supplies for her ear injury when she returned, which she used to bandage herself. Jane never did receive care for the injury from a medical professional. She explained that she didn’t believe they could help her and thought going to the hospital would put her family at risk. “I knew if I went there, doctors are going to know I got hurt and they’re going to report it. And if they report it, they’re going to go straight to make a big report, and I knew that will happen, something will happen to me or my daughter, so I was scared to report it.” She said Sambrano had explicitly threatened her family. “Oscar was texting me telling me, ‘You better be in the hospital. If you tell anything to them, the truth, something is going to happen to your sister.’” He told her if she went to the police, he would burn down her sister’s trailer, where her son lived. Jane believed he would carry out the threat. At trial, Sambrano denied telling Jane not to call the police or threatening Jane or her family members. The following month, Sambrano began arguing with Jane as she got out of the shower. Sambrano wanted to have sex, but Jane said no. Sambrano turned Jane around, pushed her onto the bed, held her down with his body, and forcibly penetrated her anally as she cried, pleaded for him to stop, and told him he was hurting her. She said the penetration hurt a lot and when it was over and she got in the shower she saw a lot of blood. She didn’t immediately report the incident to the police because she was scared. However, she did go to the police the following week, and the police arrested Sambrano. 5  Sambrano told the investigating officer that he decided to have sex with Jane when she came out of the shower wearing a towel. He initially claimed they had vaginal sex, denied she asked him to stop, and denied she bled. However, he later admitted he penetrated her anally, that she had bled, and that she did tell him it hurt and asked him to stop. Once he changed his story, he told police Jane always complained that anal sex hurt, and regularly bled as a result. At trial, Sambrano admitted having anal sex with Jane, but said it was consensual and she bled because she was on medication. A week later, Jane reported the abuse to the police because she feared for her own life and the life of her daughter. She had learned Sambrano posted social media messages asking a friend to “fucking scare” her daughter and tell her to listen to her mother or else he would come back and “get her.” When Jane confronted Sambrano with the messages, he admitted sending them but laughed and said no one would believe her. Sambrano told her he would “make that little bitch disappear” and would leave to Mexico. Sambrano later told the investigating officer he sent the messages trying to scare someone, but he wouldn’t admit Mary was the target. Investigating officers found messages from Sambrano’s social media account offering to pay a third party to “beat the shit out of . . . the . . . stupid girl” or at least “fucking scare her.” At trial, Sambrano denied sending any social media messages threatening Mary. Mary and Jane also said Sambrano had previously engaged in lewd conduct with Mary when she was 13 years old. Mary said he rubbed her leg, got her to massage his feet and legs, and tried to get her to touch his penis through his clothes. However, by the time 6 of trial she had trouble remembering details of these events. She did remember getting upset and going into the bathroom and crying. Mary told her mother, but Sambrano denied it, and Jane didn’t believe her at the time. For his part, Sambrano testified that Jane was the aggressor in the relationship, and often slapped and pushed him. He accused her of sending three masked men to attack him in June 2016, shortly before she reported him to the police. He said one of the men placed something at his back and instructed him to go inside the house and get on his knees. According to Sambrano, Jane came in, walked straight up to him, slapped him, said “Motherfucker, we’re going to have some fun with you,” and then spit in his face. He said she got a knife from the kitchen, grabbed his head, and said, “If I want to at this very moment, I could hurt you, but first we’re going to have some fun.” The men then played Russian Roulette with Sambrano, commenting he was lucky when the gun didn’t fire. They then forced Sambrano to watch as Jane removed her clothing and she and the men touched each other sexually. When the men were preparing to leave, Jane struck Sambrano’s face and knocked out a molar. Jane and the men threatened to kill him if he went to the police or kicked Jane out of the house. Sambrano also accused Jane of imprisoning him a few days later. He said she took his phone and prevented him from leaving the house for three days by threatening to hit herself and call the police to report him for abuse. 7  After his arrest, the Riverside County District Attorney’s Office charged Sambrano with three counts of corporal injury to a cohabitant (Pen. Code, § 273.5, unlabeled statutory citations refer to this code), causing great bodily injury (§ 12022.7, subd. (e)), with a prior domestic violence conviction (§ 273.5, subd. (f)), soliciting someone to commit kidnapping and murder (§ 653f, subd. (a)), dissuading a witness (§ 136.1, subd. (b)(1)), sodomy by force or violence (§ 286, subd. (c)), lewd and lascivious conduct on a child under the age of 14 (§ 288, subd. (a)), annoying or molesting a child under the age of 18 (§ 647.6, subd. (a)), and violating a domestic violence restraining order (§ 166, subd. (c)(1)). A jury convicted Sambrano of two counts of inflicting corporal injury on a cohabitant with a prior domestic violence conviction and found true the great bodily injury enhancement as to the count related to the incident when he hit Jane’s ear. They also convicted Sambrano of witness dissuasion, sodomy by force, lewd and lascivious conduct on a child, annoying or molesting a child, and violating a domestic violence restraining order. At the sentencing hearing on July 12, 2019, Sambrano asked the court to strike the punishment for the great bodily injury enhancement based on the lack of medical evidence. The court declined and imposed a total prison term of 19 years 4 months—four years for the domestic violence charge, four years for the great bodily injury enhancement, and another 11 years 4 months for the other convictions. Sambrano filed a timely notice of appeal. 8  II ANALYSIS Sambrano argues there is insufficient evidence to support the jury’s finding that he inflicted great bodily injury because the prosecution didn’t put on any medical evidence. Faced with a challenge to the sufficiency of the evidence, we review the entire record to determine whether it contains substantial evidence which would allow “a reasonable trier of fact [to] find the defendant guilty beyond a reasonable doubt.” (People v. Zamudio (2008) 43 Cal.4th 327 , 357.) Substantial evidence is “evidence that is reasonable, credible, and of solid value.” (Ibid.) The same standard applies when a defendant challenges the sufficiency of the evidence supporting a sentence enhancement. (People v. Albillar (2010) 51 Cal.4th 47 , 59-60.) A great bodily injury is “a significant or substantial physical injury” (§ 12022.7, subd. (f)), a “substantial injury beyond that inherent in the offense.” (People v. Escobar (1992) 3 Cal.4th 740 , 746.) The injury doesn’t have to be so grave as to cause the victim “‘permanent,’ ‘prolonged,’ or ‘protracted’ disfigurement, impairment, or loss of bodily function.” (Id. at p. 750.) “Abrasions, lacerations, and bruising can constitute great bodily injury.” (People v. Jung (1999) 71 Cal.App.4th 1036 , 1042, citing Escobar, at p. 752.) “Proof that a victim’s bodily injury is ‘great’ – that is, significant or substantial within the meaning of section 12022.7 – is commonly established by evidence of the severity of the victim’s physical injury, the resulting pain, or the medical care required to treat or repair the injury.” (People v. Cross (2008) 45 Cal.4th 58 , 66, italics added.) The 9 necessity of medical treatment for the victim’s injury is relevant, but not required, to demonstrate the existence of great bodily injury. (People v. Wade (2012) 204 Cal.App.4th 1142 , 1150 (Wade).) It’s up to the jury to discern the “‘fine line [that] can divide an injury from being significant or substantial from an injury that does not quite meet the description.’” (People v. Cross, supra, 45 Cal.4th at p. 64.) The jury’s determination of great bodily injury “rests on the facts as presented at trial in the context of the particular crime and the particular injuries suffered by the victim.” (Id. at p. 65.) Sambrano’s evidentiary challenge rests entirely on the fact that the jury found Jane suffered a great bodily injury based on her testimony and without corroborating medical records or testimony from a treating physician. However, it’s well established that “[e]xcept where additional evidence is required by statute, the direct evidence of one witness who is entitled to full credit is sufficient for proof of any fact.” (Evid. Code, § 411; see also People v. Miranda (2011) 199 Cal.App.4th 1403 , 1418 [“The testimony of one witness is sufficient to prove any fact”].) Section 12022.7 doesn’t except proof of great bodily injury from this general principle of evidence, and Sambrano points to no other statutory provision that does so. As the Wade court explained “the statutory definition and relevant CALCRIM instruction (No. 3160) do not require a showing of necessity of medical treatment” to establish a great bodily injury, and that they were not “aware of any case authority imposing such a requirement.” (Wade, supra, 204 Cal.App.4th at p. 1150.) If obtaining 10 treatment is not required, evidence concerning such treatment cannot be required either. It follows, that the jury was entitled to credit Jane’s testimony about the nature and extent of her injury, and that her testimony that she suffered severe, continuing pain and sustained hearing loss was sufficient to find Sambrano inflicted great bodily injury when she hit Jane in the ear. There is of course no question that evidence of medical treatment is relevant to whether a victim suffered great bodily injury. If Jane had sought immediate medical care and supplied medical records corroborating her injury and her complaints of lost hearing, the prosecution would have had very powerful evidence she suffered great bodily injury. But victims of domestic violence are not required to seek medical treatment to later seek protection under the law. Jane testified Sambrano struck her on the side of her face near her right ear and that she immediately suffered severe pain, heard a ringing in her ear, and lost hearing for several days. Several years later, at the time of the trial, she said she still had difficulty hearing in her right ear. That testimony was a sufficient basis to find she suffered a great bodily injury. It bears emphasizing Jane’s testimony was not without corroboration. Though she didn’t seek medical attention, she did complain of the pain to both Sambrano and her daughter. Both witnesses confirmed the injury and also confirmed her testimony that she bandaged the ear herself. Sambrano admitted he purchased the medical supplies for her. Thus, the evidence of the severity of Jane’s injury is more substantial than Sambrano allows. 11  More, Sambrano was able to use the fact that she didn’t seek treatment or provide medical evidence to undermine her credibility. Jane responded to questions about why she didn’t seek medical attention for her ear by explaining she didn’t think it would help her and that she feared the consequences of reporting the abuse. She said Sambrano explicitly threatened her sister and said if she reported the abuse he would burn down the home of her sister and son. The jury could have disbelieved this testimony and determined Jane was exaggerating her injury. Their verdict makes plain they instead credited her testimony, as they were entitled to do. III DISPOSITION We affirm the judgment. NOT TO BE PUBLISHED IN OFFICIAL REPORTS SLOUGH J. We concur: CODRINGTON Acting P. J. FIELDS J. 12

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https://www.courts.ca.gov/opinions/nonpub/E074054.PDF

Filed 12/1/20 P. v. Palacios CA4/2 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, E074054 v. (Super.Ct.No. FVA04210) ALEXANDER PALACIOS, OPINION Defendant and Appellant. APPEAL from the Superior Court of San Bernardino County. Michael A. Knish, Judge. Affirmed. Thomas Owen, under appointment by the Court of Appeal, for Defendant and Appellant. Xavier Becerra, Attorney General, Lance E. Winters, Chief Assistant Attorney General, Julie L. Garland, Assistant Attorney General, Charles C. Ragland, Scott C. Taylor, and James H. Flaherty III, Deputy Attorneys General, for Plaintiff and Respondent. 1  I INTRODUCTION In 2018, the Legislature passed and the Governor signed into law Senate Bill No. 1437 (Senate Bill 1437), legislation that prospectively amended the mens rea requirements for the offense of murder and restricted the circumstances under which a person can be liable for murder under the felony-murder rule or the natural and probable consequences doctrine. (Stats. 2018, ch. 1015, § 4.) Senate Bill 1437 also established a procedure permitting certain qualifying persons who were previously convicted of felony murder or murder under the natural and probable consequences doctrine to petition the courts that sentenced them to vacate their murder convictions and obtain resentencing on any remaining counts. (Ibid.; see Pen. Code,1 § 1170.95) Defendant and appellant Alexander Palacios appeals from an order denying his petition to vacate his first degree murder conviction and obtain resentencing under the procedures established by Senate Bill 1437. Defendant argues the trial court erred in summarily denying his petition because he established a prima facie case entitling him to a full hearing pursuant to section 1170.95. We reject this contention and affirm the postjudgment order denying defendant’s section 1170.95 petition. 1 All future statutory references are to the Penal Code unless otherwise stated. 2  II FACTUAL AND PROCEDURAL BACKGROUND2 On May 1, 1995, the Peralta Family lived on Valencia Street in Fontana. The family included Kathy Velasquez and her three children, Arthur Peralta (age 16), Valerie Peralta (age 14), and George Peralta (age 10). Roger Coffman (age 16) also lived with them. Down the street, Albert Zamora lived in an apartment complex. Zamora had moved to Fontana from West Covina where he was friends with defendant, George Maldonado (age 18), Lewis Pham (age 16), Harry Nabeshima (age 18), and others. The group referred to themselves as OSK, or Old School Krew.3 Prior to May 1, 1995, Maldonado visited Zamora in Fontana. On May 1, Maldonado and Zamora tried to rob Roger Coffman. They threatened him with a knife, chasing after him as he ran to the Peralta house. At the house, Zamora and Maldonado attempted to force their way inside. Arthur Peralta pushed them out. Also present were Chester Howard, Haley Stockdale, Michael Moorer, Zamora’s sister, Zamora’s mother, and some of her friends. After Zamora and Maldonado kicked down the front door to the Peralta house, Arthur Peralta shot Maldonado in the neck. The wound was not fatal. 2 The factual background is taken from this court’s nonpublished opinion in defendant’s prior appeal, case No. E017475. (People v. Palacios (Oct. 20, 1997, E017475) [nonpub. opn.] (Palacios I).) We took judicial notice of the nonpublished opinion in case No. E017475; a copy of the opinion is attached to defendant’s January 27, 2020 request for judicial notice as attachment A. (Evid. Code, § 452, subd. (d).) 3 In response to a pretrial motion, the trial court ordered the parties not to refer to “gangs,” but did permit the parties to refer to the group or association to which defendant belonged. 3  Soon after defendant heard that Maldonado had been shot, he (defendant) called Pham to talk about the shooting. Defendant was angry. He drove a gray Toyota minivan to Nabeshima’s house to convey the news of the shooting and his desire to get even with Arthur Peralta. Defendant tried to get Nabeshima to go with him (defendant), but Nabeshima refused to go. Nabeshima was afraid of defendant and Pham. Defendant told Nabeshima to call Pham and tell him to be ready and to have his gun ready. Defendant left, saying that he was going to Pham’s house. Nabeshima called Pham who indicated that he had spoken with defendant. Pham was very angry. He stated that he was going to take care of Arthur Peralta. He had a .380-caliber gun. Nabeshima said that he did not want anything to do with it. However, he conveyed defendant’s message that he was coming to get Pham and that Pham should get his gun and be ready. Anticipating trouble in return for the shooting of Maldonado, Velasquez asked her friend, Jenny Gomez, to come and pick up the children and take them to Moreno Valley for safekeeping. Gomez went with Velasquez and Valerie Peralta to take Arthur Peralta to the police station where he surrendered himself to the police. The Peraltas returned from the police station after 10 p.m. Gomez, her cousin Kathy Guerrero, Coffman, George Peralta, and Velasquez were all in the living room in the front part of the house. Valerie Peralta was in the den with her boyfriend, Robert Kalo White (age 14). They had turned off most of the lights because they anticipated trouble. The only lights on were the kitchen lights. 4  Defendant and Pham drove to the Peralta’s house. As they approached, they turned off the headlights of the van. One of the men, wearing dark clothes, quickly walked up to the darkened house. He returned to the van, then both Pham and defendant quickly came back to the house. They squatted down at the knees while running. Gomez and Coffman saw the men approaching the house and ushered everyone into a front bedroom to hide. Gomez, her cousin, and Velasquez locked themselves in the bathroom and called the police from a cordless phone. They were not able to warn Valerie Peralta or White because they could not safely walk through the lighted kitchen to get to them. The next door neighbor, Patricia Castanaza, heard someone at the Peralta’s back door say in Spanish, “‘here, here it is.’” She was aware of the shooting of Maldonado and was expecting trouble. Valerie Peralta and White heard a knock on the kitchen door. As Valerie started to get up to answer it, White pushed her down and went instead. Someone outside asked if Arthur Peralta was there. White replied that he was not. A few seconds later two gunshots were fired through the window portion of the door. White was struck in the chest by one of the shots and died a short time later. Upon hearing the shots, Castanaza went to the floor and crawled to her children’s room to protect them. She saw a man, with many of the same characteristics as defendant, run across the yard in front of her house and jump into a gray van, which had its engine running with the lights off. 5  A few days later, Nabeshima, Maldonado, Pham, and other members of OSK met outside a video store in West Covina. Pham bragged about shooting Arthur Peralta. The group agreed that the members would each tell a false story implicating a fictitious person named “Mark,” who would be described as a member of B & G, a West Covina Filipino gang, as the shooter. They decided to use the nickname “Dopey” for the fictional shooter⸺similar to Pham’s nickname of Dope. Nabeshima initially went along with the gang and lied to the police. He picked a picture of a boy name Mark Zamala out of a yearbook. However, after the police told Nabeshima that they knew he was lying and that he could be prosecuted for his lies, he decided to tell the truth. He admitted that the story involving “Mark” was false, and implicated defendant and Pham as the persons who had really gone to Fontana and who were actually involved in the shooting of White. On May 24, 1995, Pham was taken into the police station for questioning. During the interrogation, Pham stated that he had gone to the Peralta house in a van and had a .380 handgun with him. Pham stated that he had knocked on the door and asked for Arthur; however the person at the door stated that Arthur was not there. Pham stated that he fired two shots through the glass door, and subsequently gave the gun to a friend who lived in Los Angeles County. The gun was recovered by the police and tested; however, the test results were inconclusive as to whether or not the gun recovered had actually fired the bullets that killed White. 6  At trial Gomez said that defendant fit the description of the person she saw at the Peralta house that night because he had the same color of skin, same height and body structure. The facial features and complexion looked like him. On the night of the murder, Castanaza told the police that she did not see anything because she was afraid of retaliation. Later, she told the police that she had seen a Hispanic or very light skinned Black man running from the scene. She was shown three photo lineups with Black men; however, she did not pick any of those as the perpetrator. Castanaza picked defendant out of a separate photo lineup. She identified him at the preliminary hearing. Although she did not definitively identify him at trial as the perpetrator, she did testify that he shared all of the characteristics of the person she saw running away from the murder. Coffman told the police that he thought the assailants were Black. Valerie Peralta told the police that the voice at the door sounded like Chester Howard’s voice. Defendant presented no affirmative defense. Instead, he argued that this was a case of mistaken identification; that there was simply not enough evidence to place him at the scene of the murder. On September 14, 1995, a jury convicted defendant of first degree murder (§ 187, subd. (a)) and found true the allegation that a principal was armed with a firearm during the commission of the murder (§12022, subd. (a)(2)). Defendant was sentenced to an indeterminate term of 25 years to life with the possibility of parole on the murder charge, with a consecutive one-year term on the firearm allegation. 7  On October 20, 1997, we affirmed the judgment. In doing so, we rejected defendant’s argument that there was insufficient evidence to prove the killing of White was a natural and probable consequence of the attempted murder of Arthur Peralta. We also disagreed with defendant’s contention that if Pham mistakenly believed he shot Arthur Peralta, then the transferred intent doctrine, not the natural and probable consequences doctrine, applies to assess liability. (Palacios I, supra, E017475 at pp. 7- 9.) In addition, we rejected all of defendant’s instructional error claims with the exception of one, finding the error to be harmless beyond a reasonable doubt. We also disagreed with defendant’s argument that the natural and probable consequences doctrine violates the separation of powers doctrine. (Id. at pp. 9-22.) In 2018, after defendant’s judgment of conviction became final, the Legislature enacted and the Governor signed Senate Bill 1437, effective January 1, 2019. (See Stats. 2018, ch. 1015, § 1, subd. (f).) (2017-2018 Reg. Sess.) Senate Bill 1437 amended the felony-murder rule and the natural and probable consequences doctrine as it relates to murder. Senate Bill 1437 also added section 1170.95, which allows those “convicted of felony murder or murder under a natural and probable consequences theory . . . [to] file a petition with the court that sentenced the petitioner to have the petitioner’s murder conviction vacated and to be resentenced on any remaining counts . . . .” (§ 1170.95, subd. (a).) On January 4, 2019, defendant in propria persona filed a petition for resentencing pursuant to section 1170.95, requesting that his murder conviction be vacated based on 8 changes to sections 188 and 189, as amended by Senate Bill 1437. The trial court thereafter appointed counsel to represent defendant, and the People filed opposition to the petition for resentencing. The People argued that defendant failed to make a prima facie showing he falls within the provisions of section 1170.95, and thus requested the court deny defendant’s request for relief. The trial court heard the petition on August 22 and September 9, 2019. The court denied the petition for resentencing, finding defendant had not set forth a prima facie case for relief. The court noted, “It’s nonsensical to me to apply this law in a case where the Defendant was convicted of being a major aider and abettor in going to a house for revenge; and even though he wasn’t the shooter, they sort of came in with guns blazing, and the other Defendant shot the victim.” The court also explained the case was not prosecuted under a felony-murder theory but “an aiding and abetting of an attempted murder that led to a murder of someone else, and so this law doesn’t apply to [defendant].” On November 5, 2019, defendant filed a timely notice of appeal from the denial of his section 1170.95 petition. III DISCUSSION Defendant contends the trial court erred in denying his section 1170.95 petition for resentencing because he had established a prima facie case for relief. He believes we should remand the matter for a full evidentiary hearing pursuant to section 1170.95, in 9 light of the changes in the law not anticipated by the parties 24 years ago and the trial court solely relying on this court’s prior nonpublished opinion from his direct appeal. Defendant further argues “[a] Court of Appeal’s finding of sufficiency of the evidence is solely a judicial deference to a jury’s verdict. That sufficient evidence was found by the Court of Appeal had no bearing on the present issue. In other words, from the Court of Appeal’s unpublished opinion and on the present record, it cannot be said definitively that the jury found [him] guilty based on direct aiding and abetting murder such that the jury would not have found [him] guilty upon a natural and probable consequence theory of murder had the jury been properly instructed. The original Court of Appeal opinion noted erroneous jury instructions.”4 A. Senate Bill 1437 By amending sections 188 (defining malice) and 189 (defining the degrees of murder), Senate Bill 1437, effective January 1, 2019, changed “the felony murder rule and the natural and probable consequences doctrine, as it relates to murder, to ensure that murder liability is not imposed on a person who is not the actual killer, did not act with the intent to kill, or was not a major participant in the underlying felony who acted with 4 Defendant mistakenly asserts we found more than one instructional error in his direct appeal. (See Palacios I, supra, E017475 at pp. 8-22.) We found one instructional error relating to the trial court’s failure to instruct the jury that the target crime of attempted murder requires a finding of express malice. Nonetheless, we concluded the error was harmless beyond a reasonable doubt under Chapman v. California (1967) 386 U.S. 18 , 24, in part, because the jury was instructed on both express and implied malice. (Palacios I, E017475 at pp. 11-13.) 10 reckless indifference to human life.” (Stats. 2018, ch. 1015, § 1, subd. (f); see People v. Martinez (2019) 31 Cal.App.5th 719 , 722-723 (Martinez).) Prior to Senate Bill 1437’s enactment, a person who knowingly aided and abetted a crime, the natural and probable consequence of which was murder or attempted murder, could be convicted of not only the target crime but also of the resulting murder or attempted murder. (People v. Chiu (2014) 59 Cal.4th 155 , 161 (Chiu); In re R.G. (2019) 35 Cal.App.5th 141 , 144 (R.G.).) “This was true irrespective of whether the defendant harbored malice aforethought. Liability was imposed ‘“for the criminal harms [the defendant] . . . naturally, probably, and foreseeably put in motion.” [Citations.]’ [Citation.]” (R.G., at p. 144.) “The purpose of the felony-murder rule [was] to deter those who commit[ted] the enumerated felonies from killing by holding them strictly responsible for any killing committed by a cofelon, whether intentional, negligent, or accidental, during the perpetration or attempted perpetration of the felony.” (People v. Cavitt (2004) 33 Cal.4th 187 , 197.) Aider and abettor liability under the doctrine was thus “vicarious in nature.” (Chiu, at p. 164.) Senate Bill 1437 did not “alter the law regarding the criminal liability of direct aiders and abettors of murder because such persons necessarily ‘know and share the murderous intent of the actual perpetrator.’” (People v. Lewis (2020) 43 Cal.App.5th 1128 , 1135 (Lewis), review granted Mar. 18, 2020, S260598.5) Accordingly, “[o]ne who 5 Under California Rules of Court, rule 8.1115, we may rely on appellate cases while review is pending as persuasive authority. (Cal. Rules of Court, rule 8.1115(e)(1), eff. July 1, 2016.) 11 directly aids and abets another who commits murder is thus liable for murder under the new law just as he or she was liable under the old law.” (Ibid.) Senate Bill 1437 also added section 1170.95. That section provides that “[a] person convicted of felony murder or murder under a natural and probable consequences theory may file a petition with the court that sentenced the petitioner to have the petitioner’s murder conviction vacated and to be resentenced on any remaining counts.” (§ 1170.95, subd. (a).) A petition may be filed when the following three conditions are met: “(1) A complaint, information, or indictment was filed against the petitioner that allowed the prosecution to proceed under a theory of felony murder or murder under the natural and probable consequences doctrine. [¶] (2) The petitioner was convicted of first degree or second degree murder following a trial or accepted a plea offer in lieu of a trial at which the petitioner could be convicted for first degree or second degree murder. [¶] (3) The petitioner could not be convicted of first or second degree murder because of changes to Section 188 or 189 made effective January 1, 2019.” (§ 1170.95, subd. (a)(1)- (3); see Martinez, supra, 31 Cal.App.5th at p. 723.) Courts of Appeal have interpreted section 1170.95 to provide for multiple reviews of a petition by the trial court. (People v. Tarkington (2020) 49 Cal.App.5th 892 , 897- 898, review granted Aug. 12, 2020, S263219; People v. Cornelius (2020) 44 Cal.App.5th 54 , 57-58, review granted Mar. 18, 2020, S260410; People v. Verdugo (2020) 44 Cal.App.5th 320 , 326-328 (Verdugo), review granted Mar. 18. 2020, S260493.) Subdivision (b) of section 1170.95 describes an initial review to determine the facial 12 sufficiency of the petition. (Verdugo, at pp. 327-328.) To be facially sufficient, the petition must contain the petitioner’s declaration that the petitioner is eligible for relief according to the criteria in subdivision (a), the case number and year of conviction, and whether the petitioner is requesting appointment of counsel. (§ 1170.95, subd. (b)(1).) If the petition is missing any of this information “and cannot be readily ascertained by the court, the court may deny the petition without prejudice.” (§ 1170.95, subd. (b)(2).) This initial review amounts essentially to a ministerial review to ensure that the right boxes are checked. Section 1170.95, subdivision (c), then describes the next two levels of review and sets forth the trial court’s obligations upon the submission of a complete petition. It provides, “The court shall review the petition and determine if the petitioner has made a prima facie showing that the petitioner falls within the provisions of this section. If the petitioner has requested counsel, the court shall appoint counsel to represent the petitioner. The prosecutor shall file and serve a response within 60 days of service of the petition and the petitioner may file and serve a reply within 30 days after the prosecutor’s response is served. These deadlines shall be extended for good cause. If the petitioner makes a prima facie showing that he or she is entitled to relief, the court shall issue an order to show cause.” The first sentence in subdivision (c) refers to a prebriefing, initial prima facie review to preliminarily determine a petitioner’s statutory eligibility for relief as a matter of law. (Verdugo, supra, 44 Cal.App.5th at p. 329.) In this step of review, the trial court 13 determines, based upon its review of readily ascertainable information in the record of conviction and the court file, whether the petitioner is statutorily eligible for relief. (Id. at pp. 329-330.) The court may review the complaint, the information or indictment, the verdict form or the documentation for a negotiated plea, and the abstract of judgment. (Ibid.) A court of appeal opinion is part of the defendant’s record of conviction (id. at p. 333; Lewis, supra, 43 Cal.App.5th at pp 1137-1138 [in determining the sufficiency of a section 1170.95 petition, the court may review the record of conviction, which includes the opinion in a defendant’s direct appeal]; People v. Bascomb (2020) 55 Cal.App.5th 1077 , 1080-1081 [same]), as are jury instructions. (People v. Soto (2020) 51 Cal.App.5th 1043 , 1055, review granted Sept. 23, 2020, S263939.) If these documents reveal ineligibility for relief, the trial court can dismiss the petition. (Verdugo, at p. 330.) Contrary to defendant’s claim, Courts of Appeal, including this court, have rejected the argument that a trial court is limited to the allegations in the petition when determining whether the petitioner has stated a prima facie claim for relief under section 1170.95. The Courts of Appeal concluded that a trial court can consider the defendant’s record of conviction, including documents in the court’s own file and the appellate opinion resolving the defendant’s direct appeal, in determining eligibility. (Lewis, supra, 43 Cal.App.5th at pp. 1137-1138; Verdugo, supra, 44 Cal.App.5th at pp. 329-330; People v. Law (2020) 48 Cal.App.5th 811 , 820-821.) Relying on Lewis and Verdugo, we held that when determining whether a petitioner has stated a prima facie claim for relief under section 1170.95, the trial court is not limited to the allegations in 14 the petition. Rather, the court may consider the entire record of conviction and subsequent appellate opinion. (Law, at pp. 820-821 [trial court did not err by looking to the record of conviction, the opinion in the defendant’s direct appeal, and the jury instructions from his trial in evaluating his petition].) We therefore conclude the trial court here did not err by considering the record of conviction in evaluating defendant’s petition. But, if the record of conviction does not establish as a matter of law the petitioner’s ineligibility for resentencing, evaluation of the petition proceeds to the second prima facie review, in which “the court must direct the prosecutor to file a response to the petition, permit the petitioner (through appointed counsel if requested) to file a reply and then determine, with the benefit of the parties’ briefing and analysis, whether the petitioner has made a prima facie showing he or she is entitled to relief.” (Verdugo, supra, 44 Cal.App.5th at p. 330.) The trial court must accept as true the petitioner’s factual allegations and make a preliminary assessment regarding whether the petitioner would be entitled to relief if the factual allegations were proved. (Id. at p. 328.) Once the order to show cause issues, the court must hold a hearing to determine whether to vacate the murder conviction and to recall the sentence and resentence the petitioner on any remaining counts. (§ 1170.95, subd. (d)(1).) At such a hearing, both the prosecution and the defense may rely on the record of conviction or may offer new or additional evidence. (§ 1170.95, subd. (d)(3).) “[T]he burden of proof shall be on the 15 prosecution to prove, beyond a reasonable doubt, that the petitioner is ineligible for resentencing.” (§ 1170.95, subd. (d)(3); Martinez, supra, 31 Cal.App.5th at pp. 723-724.) If the petitioner is found eligible for relief, the murder conviction must be vacated and the petitioner resentenced “on any remaining counts in the same manner as if the petitioner had not been [sic] previously been sentenced, provided that the new sentence, if any, is not greater than the initial sentence.” (§ 1170.95, subd. (d)(1).) If the petitioner is found eligible for relief, but “murder was charged generically[ ] and the target offense was not charged,” the petitioner’s murder conviction must be “redesignated as the target offense or underlying felony for resentencing purposes.” (§ 1170.95, subd. (e).) B. Analysis Defendant contends he is entitled to a full evidentiary hearing because his jury in 1995 could have been presented with two theories, i.e., direct aiding and abetting and natural and probable consequences, and “the record does not conclusively demonstrate that with the benefit of proper jury instructions,” he would have been guilty “under the direct theory and harbored express malice.” He also argues that the jury might have based his murder liability on its conclusion that White’s murder was the natural and probable consequence of the target felony of the attempted murder of Arthur Peralta. Therefore, he believes that if he aided and abetted in the attempted murder, he might have been convicted of murder without possessing malice because White was not the intended target but merely in the wrong place at the wrong time. 16  Here, there is no dispute defendant was not the actual killer. However, defendant’s record of conviction shows that he directly aided and abetted in the murder. In our prior opinion, we explained, “Assuming that defendant intended to kill Arthur Peralta, but not White, the jury was instructed that, in order to find defendant guilty as an aider and abettor of murder, it was required to find that defendant and Pham shared that intent. The transferred intent instruction does not alter that requirement. Moreover, the evidence was plainly sufficient for the jury to infer that defendant engaged Pham’s support and both went to the Peraltas’ house gunning for Arthur Peralta. Whether defendant and Pham were both mistaken that White was Arthur Peralta, or whether only Pham made the mistake, both shared the same intent—to kill Arthur Peralta—and defendant was properly liable as an aider and abettor. [Citation.] [¶] As an aider and abettor, defendant is also liable for the natural and probable consequences of any act he knowingly aided and encouraged. [Citations.] The natural and probable consequences doctrine only applies when the defendant’s confederate committed an offense other than the target crime. [Citation.] Here, defendant knowingly aided and encourage[d] Pham in the attempt to murder Arthur Peralta. However, Pham, believing that he shot Arthur Peralta, actually shot White. We find sufficient evidence to support a finding that the killing of White was a natural and probable consequence of the attempt to murder Arthur Peralta.” (Palacios I, supra, E017475 at pp. 8-9, fns. omitted.) In addition, the jury was instructed with the general rules of aiding and abetting liability pursuant to CALJIC No. 3.02, which, at the time of defendant’s trial, provided: 17 “‘One who aids and abets another in the commission of a crime is not only guilty of that crime but also guilty of any other crime committed by a principal which is a natural and probable consequence of the crime originally aided and abetted. [¶] In order to find the defendant guilty of the crime of murder as charged in Count 1 you must be satisfied beyond a reasonable doubt that (1) the crime of murder was committed and (2) that the defendant aided and abetted such crime, (3) that a co-principal in such crime committed the crime of murder, and (4) the crime of murder of Robert Kalo White was a natural and probable consequence of the attempted commission of the crime of murder of Arthur Peralta.’” (Palacios I, supra, E017475 at p. 10, fn. 6.) The trial court also instructed the jury regarding attempted murder being the target offense. At the time of defendant’s trial, CALJIC No. 8.66 defined attempted murder. That instruction provided that the crime of attempted murder necessarily required the jury to find that the accused “harbored express malice aforethought, namely, a specific intent to kill unlawfully another human being.” (CALJIC No. 8.66) And this court in defendant’s direct appeal concluded the record conclusively demonstrated that the jury found defendant had “harbored express malice.” (Palacios I, supra, E017475 at p. 13.) We explained: “The evidence that the Pham harbored express malice was uncontradicted. Nabeshima testified that Pham was very angry and that he stated that he was going to take care of Arthur Peralta. Pham had a .380 caliber gun. Defendant drove to Pham’s residence, picked up Pham, and the two of them drove to Arthur Peralta’s home. At the Peraltas[’ house], defendant and Pham went to the back door looking for 18 Arthur Peralta. They knocked on the door, asked for Arthur Peralta, was told he was not there, and then Pham immediately shot White. A few days later, Pham was bragging about having shot the guy who shot Maldonado. [¶] Although the jury was not told that they had to find that Pham harbored express malice, they were instructed on both express and implied malice. With respect to defendant’s conviction of murder, the jury found that defendant committed murder in the first degree. Thus, it found that defendant harbored express malice. Having found defendant harbored express malice, the jury must have also found that Pham harbored express malice. Based on the record before us, there can be no question that the uncontradicted evidence established that Pham harbored express malice when he went with defendant to the Peralta house.” (Id. at p. 13.) As the Lewis court observed, while the amendment to section 188 effectively eliminated use of the natural and probable consequences doctrine to support a murder conviction, the change did not “alter the law regarding the criminal liability of direct aiders and abettors of murder because such persons necessarily ‘know and share the murderous intent of the actual perpetrator.’ (People v. McCoy (2001) 25 Cal.4th 1111 , 1118; see Chiu, supra, 59 Cal.4th at p. 167 [a direct aider and abettor ‘acts with the mens rea required for first degree murder’].)” (Lewis, supra, 43 Cal.App.5th at p. 1135.) However, a direct aider and abettor can be convicted of murder notwithstanding Senate Bill 1437’s amendments to sections 188 and 189, which changed nothing with regard to direct aider and abettor liability. “One who directly aids and abets another who commits murder is thus liable for murder under the new law just as he or she was liable 19 under the old law.” (Lewis, supra, 43 Cal.App.5th at p. 1135.) Accordingly, defendant was required to make a prima facie showing that he was not convicted as a direct aider and abettor, and thereby “‘falls within the provisions of’ the statute.” (Id. at p. 1137; § 1170.95, subd. (a)(3) & (c).) He failed to do so. The trial court therefore properly denied the petition on the basis of its finding that defendant had not established a prima facie case for relief by relying on this court’s prior opinion in defendant’s direct appeal. Claiming the record does not “definitively” or “conclusively” show the jury found him guilty based on direct aiding and abetting murder, defendant argues at length he is entitled to a full evidentiary hearing under section 1170.95. Defendant has already challenged the sufficiency of the evidence in support of his conviction as an aider and abettor in his direct appeal, and lost. (See Palacios I, supra, E017475 at pp. 8-22.) As discussed above, nothing in the amendments to sections 188 and 189 altered the criminal liability of direct aiders and abettors of murder. Such persons may still be convicted of first degree premeditated murder based on their own knowledge of the perpetrator’s unlawful purpose and their own intent to commit, encourage, or facilitate the commission of the murder. (Chiu, supra, 59 Cal.4th at p. 167 [direct aider and abettor “acts with the mens rea required for first degree murder”]; Lewis, supra, 43 Cal.App.5th at p. 1135.) Defendant cannot challenge the sufficiency of the evidence supporting his first degree murder conviction as a direct aider and abettor in an appeal from the denial of his section 1170.95 petition. 20  Likewise, we reject defendant’s contention relating to “principles of law associated with unanimity” and constitutional right to a unanimous jury verdict. A similar claim was already raised and rejected in defendant’s direct appeal. In his prior appeal, he argued “‘[t]he rendition of the “natural and probable consequences” instruction . . . , coupled with the trial court’s failure to give a “unanimity” instruction, deprived [him] of his Fourteenth Amendment right to due process of law and his Sixth Amendment right to jury trial.’ In support of this argument, he contends that the jury was authorized to find him guilty either if he aided and abetted a premeditated murder of White or if he aided and abetted an attempted murder of Arthur Peralta.” (Palacios I, supra, E017475 at pp. 21-22.) Defendant cannot challenge the right to a unanimous jury verdict in an appeal from the denial of his section 1170.95 petition. In sum, the allegations in the petition that defendant cannot now be convicted of first or second degree murder because of changes made to sections 188 and 189 are contradicted by the record of conviction. Because the record of conviction plainly shows that defendant does not fall within the provisions of the statute, he did not make the first prima facie showing required under section 1170.95, subdivision (c). Defendant is thus ineligible for relief as a matter of law, and the trial court properly denied his petition. (§ 1170.95, subd. (c); Verdugo, supra, 44 Cal.App.5th at p. 329.) 21  IV DISPOSITION The trial court’s postjudgment order denying defendant’s section 1170.95 resentencing petition is affirmed. NOT TO BE PUBLISHED IN OFFICIAL REPORTS CODRINGTON Acting P. J. We concur: SLOUGH J. FIELDS J. 22

2020-12-02 00:02:11.166288+00

https://www.courts.ca.gov/opinions/nonpub/B297558.PDF

Filed 12/1/20 P. v. Miller CA2/5 NOT TO BE PUBLISHED IN THE 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 SECOND APPELLATE DISTRICT DIVISION FIVE THE PEOPLE, B297558 Plaintiff and Respondent, (Los Angeles County Super. Ct. No. BA226937) v. TYRONE MILLER et al., Defendants and Appellants. APPEAL from orders of the Superior Court of Los Angeles County, George G. Lomeli, Judge. Reversed and remanded. Leslie Conrad, under appointment by the Court of Appeal, for Defendant and Appellant Tyrone Miller. Daniel G. Koryn, under appointment by the Court of Appeal, for Defendant And Appellant Derrick Patton. Xavier Becerra, Attorney General, Lance E. Winters, Chief Assistant Attorney General, Susan Sullivan Pithey, Senior Assistant Attorney General, Amanda V. Lopez and Kathy S. Pomerantz, Deputy Attorneys General, for Plaintiff and Respondent. 2  A jury convicted defendants and appellants Derrick Patton (defendant Patton) and Tyrone Miller (defendant Miller) of first degree felony murder. Following enactment of Senate Bill No. 1437 (Senate Bill 1437), defendants separately filed uncounseled petitions for resentencing pursuant to Penal Code section 1170.95.1 The trial court denied their petitions without first appointing counsel, and we consider whether either defendant is eligible to have his murder conviction vacated in light of the changes worked by Senate Bill 1437. I. BACKGROUND Defendants and Melvin Tate (Tate) were members of the 4- Deuce Crips street gang and they had participated in a number of “follow-home” robberies as part of the gang’s activities. (In re Miller (2017) 14 Cal.App.5th 960 , 964.) These robberies were conducted in a similar fashion: a “spotter” would go into a bank, locate a person withdrawing a large amount of cash, and identify that person for the others involved in committing the robbery; the “driver” would tail the victim to his or her destination; and the “getter” would take the money. (Ibid.) In May 2000, defendants met Tate at his residence and planned a follow-home robbery that led to the murder convictions at issue in this appeal; defendant Miller would serve as the spotter, defendant Patton the driver, and Tate the getter. (In re Miller, supra, 14 Cal.App.5th at 965.) When they later put their plan into practice, defendant Miller spotted Ana Saravia (Saravia) withdrawing $7,500 at a bank while accompanied by 1 Undesignated statutory references that follow are to the Penal Code. 3 Rene Franco (Franco). (Ibid.) After Saravia and Franco exited the bank, defendant Miller instructed defendant Patton and Tate to follow them, advising Saravia had a lot of money in her purse. (Ibid.) Defendant Patton and Tate tailed Saravia and Franco to a car dealership. (In re Miller, supra, 14 Cal.App.5th at 965.) Defendant Patton handed Tate a loaded pistol and told him, “[m]ake sure you get the purse.” (Ibid.) Tate approached Franco and Saravia, grabbed Saravia’s purse, and knocked her to the ground. (Ibid.) When Franco moved to intervene, Tate shot him in the chest, killing him. (Ibid.) Defendant Patton and Tate drove off and later rendezvoused at defendant Miller’s home, where the three men divided the $7,500 they stole from Saravia. (Ibid.) A jury found defendants guilty of murdering Franco. (In re Miller, supra, 14 Cal.App.5th at 965.) The jury also found true an allegation that the killing occurred in the commission of a robbery within the meaning of section 190.2, subdivision (a)(17)(A)—a “special circumstance” that required a sentence of life in prison without the possibility of parole (§ 190.2, subd. (d)). That is the sentence the trial court imposed (plus additional prison terms for certain other allegations the jury found true).2 (Id. at 965-966.) This court affirmed the convictions on direct appeal in a 2003 opinion. 2 Section 190.2, subdivision (d) states “every person, not the actual killer, who, with reckless indifference to human life and as a major participant,” aids, abets, or assists in a robbery that results in the death of some person or persons and is found guilty of first degree murder shall be punished by death or life in prison without the possibility of parole. 4  More than a decade later, following our Supreme Court’s decisions in People v. Banks (2015) 61 Cal.4th 788 (Banks) and People v. Clark (2016) 63 Cal.4th 522 (Clark) that explain when a felony murder aider and abettor may be sentenced to life in prison without the possibility of parole, defendant Miller petitioned for a writ of habeas corpus in this court. We granted the petition and vacated the special circumstance true finding against him.3 (In re Miller, supra, 14 Cal.App.5th at 966-967 [“[T]he evidence against defendant [Miller] would not permit a jury to rationally conclude he exhibited a reckless indifference to human life”].) In 2017, Defendant Patton also sought habeas corpus relief in this court, similarly relying on Banks and Clark, but we summarily denied his petition. Most recently, and key for purposes of this appeal, defendants separately filed section 1170.95 petitions for resentencing pursuant to newly enacted Senate Bill 1437, which “amend[ed] the felony murder rule and the natural and probable consequences doctrine, as it relates to murder, to ensure that murder liability is not imposed on a person who is not the actual killer, did not act with the intent to kill, or was not a major participant in the underlying felony who acted with reckless indifference to human life.” (Stats. 2018, ch. 1015, § 1, subd. (f).) The trial court denied both petitions without appointing counsel for defendants and without soliciting opposition from the People. As to defendant Miller, the court recognized he was 3 The superior court later resentenced defendant Miller to 25 years to life for murder under section 187, subdivision (a) plus 25 years to life for a firearm enhancement under section 12022.53, subdivision (d). 5 “seemingly” entitled to relief under the provisions added to the Penal Code by Senate Bill 1437, but the court concluded Senate Bill 1437 was unconstitutional and denied his petition on that basis. The trial court likewise denied defendant Patton’s section 1170.95 petition on constitutional grounds, but the court also found, in the alternative, that defendant Patton was ineligible for relief because he was a “major participant [in the crime] who acted with reckless indifference.” II. DISCUSSION The trial court denied defendants’ section 1170.95 petitions because the court believed Senate Bill 1437 is unconstitutional. That is wrong. (See, e.g., People v. Bucio (2020) 48 Cal.App.5th 300 ; People v. Solis (2020) 46 Cal.App.5th 762 , 769 [“Senate Bill No. 1437 addresses the elements of the crime of murder and is directed to the mental state and conduct of those accused of murder. [Citation.] It does not authorize anything [two voter- approved] initiatives prohibited, nor prohibit anything they authorized”]; People v. Cruz (2020) 46 Cal.App.5th 740 ; People v. Superior Court (Gooden) (2020) 42 Cal.App.5th 270 ; People v. Lamoureux (2019) 42 Cal.App.5th 241 , 246 [“[W]e conclude the resentencing provision of Senate Bill 1437 does not contravene separation of powers principles or violate the rights of crime victims”].) We need say no more about that. More does need to be said, however, about defendants’ statutory eligibility for relief. The bottom line is that reversal is required because neither defendant is ineligible for section 1170.95 relief as a matter of law. That is obvious when it comes to defendant Miller, as to whom this court has already reached a post-Banks and Clark 6 conclusion that he did not act with reckless indifference to human life. (Miller, supra, 14 Cal.App.5th 975 [“[W]e are convinced the evidence was insufficient to show defendant [Miller] acted with a reckless indifference to human life”].) As the Attorney General concedes, that post-Banks and Clark finding means he is entitled to resentencing under section 1170.95 without further ado. (§ 1170.95, subd. (d)(2) [“If there was a prior finding by a court or jury that the petitioner did not act with reckless indifference to human life or was not a major participant in the felony, the court shall vacate the petitioner’s conviction and resentence the petitioner”]; see also People v. Ramirez (2019) 41 Cal.App.5th 923 , 932-933.) The conclusion that reversal is required is less obvious as to defendant Patton, given his apparent role in Franco’s killing (handing the murder weapon to the actual killer at the scene of the crime) and our summary denial of his prior habeas petition (although that is not law of the case (see generally Gomez v. Superior Court (2012) 54 Cal.4th 293 , 305, fn. 6)). But obvious or not, the conclusion still obtains. Defendant Patton’s eligibility turns on an evidentiary assessment of whether he was a major participant who acted with reckless indifference to life and— critically—such an assessment can be made only after counsel is appointed for defendant Patton and has an opportunity to proffer additional evidence, beyond the existing record of conviction, that might alter an assessment of his role in Franco’s killing. (People v. York (2020) 54 Cal.App.5th 250 , 258, review granted Nov. 18, 2020, S264954; People v. Smith (2020) 49 Cal.App.5th 85 , 92, review granted Jul. 22, 2020, S262835 [“If . . . a determination of eligibility requires an assessment of the evidence concerning the commission of the petitioner’s offense, the trial court must 7 appoint counsel and permit the filing of the submissions contemplated by section 1170.95”]; id. at 96 [“[W]e cannot say at this stage of the proceedings that failure to appoint counsel was harmless ‘given the trial evidence’; by the express terms of section 1170.95, subdivision (d)(3), counsel is not limited to the trial evidence”]; see also People v. Murillo (2020) 54 Cal.App.5th 160 , 173, review granted Nov. 18, 2020, S264978 [“If as a matter of law the record of conviction shows . . . that the defendant was a major participant who acted with reckless indifference to human life, and the defendant does not claim he has new evidence to present, he has not made a prima facie case”], italics added.) Of course, if such an evidentiary proffer is not forthcoming (or if it is, but still does not defeat a conclusion that defendant Patton is ineligible for relief as a matter of law), then the trial court will be justified in denying defendant Patton’s section 1170.95 petition without issuing an order to show cause. 8  DISPOSITION The orders denying defendants’ section 1170.95 petitions are reversed. The trial court is directed to vacate defendant Miller’s murder conviction and resentence him consistent with section 1170.95, subdivisions (a) and (d)(2). The trial court is directed to appoint counsel for defendant Patton and thereafter proceed as required by section 1170.95, subdivision (c). NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS BAKER, J. We concur: RUBIN, P. J. KIM, J. 9

2020-03-06 00:00:26.567854+00

http://media.ca11.uscourts.gov/opinions/pub/files/202010873.ord1.pdf

Case: 20-10873 Date Filed: 03/05/2020 Page: 1 of 11 [PUBLISH] IN THE UNITED STATES COURT OF APPEALS FOR THE ELEVENTH CIRCUIT ________________________ No. 20-10873-P ________________________ D.C. Docket No. 2:16-cv-01758-LSC-JEO NATHANIEL WOODS, Petitioner-Appellant, versus WARDEN, HOLMAN CORRECTIONAL FACILITY, ATTORNEY GENERAL, STATE OF ALABAMA, Respondents-Appellees. ________________________ Appeal from the United States District Court for the Northern District of Alabama ________________________ (March 5, 2020) Before ED CARNES, Chief Judge, WILLIAM PRYOR and ROSENBAUM, Circuit Judges. WILLIAM PRYOR, Circuit Judge: Nathaniel Woods is set to be executed on March 5, 2020, for his 2005  Case: 20-10873 Date Filed: 03/05/2020 Page: 2 of 11 capital-murder convictions for intentionally killing three on-duty police officers. Mere hours before his execution, he filed an emergency motion for appointment of substitute counsel, 18 U.S.C. § 3599(a)(2), and for a limited stay, 28 U.S.C. § 2251(a)(3). We deny the motion. I. BACKGROUND The Alabama Court of Criminal Appeals described the facts leading to Woods’s arrest and conviction in its opinion on direct appeal in Woods v. State, 13 So. 3d 1 (Ala. Crim. App. 2007) (Woods I), and its opinion in the appeal from the denial of Woods’s petition for state postconviction relief in Woods v. State, 221 So. 3d 1125 (Ala. Crim. App. 2016) (Woods II). On June 17, 2004, Birmingham police officers Carlos Owen, Harley A. Chisholm III, Charles R. Bennett, and Michael Collins went to an apartment located on 18th Street in Birmingham, Alabama, to serve a warrant on Nathaniel Woods for assault. Woods II, 221 So. 3d at 1130. The evidence at trial proved that after Woods and his codefendant, Kerry Spencer, subjected the officers to a hostile, profanity-laced argument and made threats against them, the officers entered the apartment and attempted to arrest Woods. Woods I, 13 So. 3d at 4 –10. In the course of the attempted arrest, all four officers were shot, and Officers Owen, Chisholm, and Bennett died from their wounds. Id. The State of Alabama charged Woods with four counts of capital murder. He 2  Case: 20-10873 Date Filed: 03/05/2020 Page: 3 of 11 was charged with three counts of intentionally causing the death of an on-duty police officer, Ala. Code § 13A–5–40(a)(5), and he was charged with causing the death of all three officers through one act, scheme, or course of conduct, id. § 13A–5–40(a)(10). Woods I, 13 So. 3d at 4 . In October 2005, a jury unanimously found Woods guilty on all charges and recommended a sentence of death by a vote of 10 to 2. Id. at 4–5. The judge imposed a death sentence. On direct appeal, the Alabama Court of Criminal Appeals affirmed Woods’s convictions but remanded for an amended sentencing order that would clarify the trial court’s findings regarding nonstatutory mitigating factors. Id. at 40. After the trial court entered its amended sentencing order, Woods appealed again, and the Alabama Court of Criminal Appeals affirmed his death sentence on December 21, 2007. Id. at 43. After the Alabama Court of Criminal Appeals ruled against Woods, his counsel on direct appeal, Glennon Threatt, moved to withdraw and failed to file an application for rehearing in the Alabama Court of Criminal Appeals even though doing so is a prerequisite for seeking certiorari review in the Alabama Supreme Court. See Ala. R. App. P. 39(c)(1). Threatt also failed to file a petition for a writ of certiorari with the Alabama Supreme Court. As a result, a certificate of judgment was issued on January 9, 2008. Woods II, 221 So. 3d at 1130. On April 29, 2008, Woods filed a motion for an out-of-time appeal in the Alabama Supreme Court, alleging that his direct-appeal counsel never discussed 3  Case: 20-10873 Date Filed: 03/05/2020 Page: 4 of 11 further proceedings with him. The Alabama Supreme Court put the matter on hold until the Alabama Court of Criminal Appeals considered the issue, and on May 9, 2008, Woods filed a motion to withdraw the certificate of judgment to permit filing of an application for rehearing. The Alabama Court of Criminal Appeals denied Woods’s motion, and on August 24, 2009, the Alabama Supreme Court denied his motion to pursue an out-of-time appeal. The United States Supreme Court denied certiorari on February 22, 2009. Woods v. Alabama, 559 U.S. 942 (2010). Woods filed a petition for state postconviction relief under Alabama Rule of Criminal Procedure 32 in the Jefferson County circuit court on December 30, 2008, while his motion for an out-of-time appeal was still pending in the Alabama Supreme Court. He also filed a motion to stay and hold his petition under Rule 32 in abeyance pending the decision regarding an out-of-time appeal, which the circuit court granted. After the State filed an answer to Woods’s petition, the circuit court summarily dismissed the petition on December 1, 2010. Woods filed a motion for reconsideration, which the circuit court denied. Woods then filed an appeal from the dismissal of his petition under Rule 32, but the Alabama Court of Criminal Appeals affirmed the circuit court’s dismissal on April 29, 2016. Woods II, 221 So. 3d at 1152. The Alabama Supreme Court denied certiorari on September 16, 2016, and Woods did not seek a writ of certiorari from the United States Supreme Court. 4  Case: 20-10873 Date Filed: 03/05/2020 Page: 5 of 11 Woods filed a federal petition for a writ of habeas corpus on October 27, 2016, which the district court denied. The district court also denied Woods’s motion for a certificate of appealability. Woods moved for a certificate of appealability in this Court on January 21, 2019. We denied the certificate of appealability on February 22, 2019. Woods v. Holman, No. 18-14690-P, 2019 WL 5866719 (11th Cir. Feb. 22, 2019). We concluded that he was not entitled to a certificate of appealability on any of his four claims. He argued that his direct-appeal counsel was ineffective for failing to file an application for rehearing or a petition for a writ of certiorari with the Alabama Supreme Court, that his trial counsel were ineffective at the penalty phase of his trial, that his postconviction counsel were ineffective because they failed to raise claims of ineffectiveness of his trial and direct appeal attorneys, and that his direct-appeal counsel was ineffective because he allegedly labored under an actual conflict of interest and failed to request that the Alabama Court of Appeals conduct meaningful proportionality review of Woods’s sentence. The Supreme Court denied Woods’s petition for a writ of certiorari on October 7, 2019. On March 3, 2020, Woods filed an emergency motion for appointment of new counsel, 28 U.S.C. § 3599(a)(2), and a limited stay of execution, 28 U.S.C. § 2251(a)(3), in his closed habeas proceeding in the Northern District of Alabama. Woods contended that he had obtained counsel for a clemency petition, and that 5  Case: 20-10873 Date Filed: 03/05/2020 Page: 6 of 11 she had uncovered evidence that casts doubt on his convictions and sentence. He also pointed to purported deficiencies or conflicts that plagued his counsel at trial, on appeal, and in each of his collateral proceedings. In the light of this evidence and the alleged deficiencies of his counsel, Woods requested that the court appoint him new counsel to bring additional challenges in federal court, 28 U.S.C. § 3599(a)(2), and grant a limited stay of execution to permit the new counsel to investigate his potential claims. See 28 U.S.C. § 2251(a)(3). On March 3, the district court ruled that it lacked jurisdiction to consider Woods’s motion because Woods had already litigated one habeas petition and Woods had not sought and this Court had not granted Woods permission to file a second or successive habeas application. See 28 U.S.C. § 2244(b)(3)(A). On March 4, at almost 5:00 p.m., Woods filed a motion to alter or amend the judgment, Fed. R. Civ. P. 59(e), in which he argued that the district court erred in treating his motion as a second or successive habeas application. The district court denied the motion. It ruled that Woods’s motion for substitution of counsel failed because “Woods’ current federal habeas counsel is adequate representation” and that the court “lacks the authority to appoint counsel under [section] 3599 for an unauthorized second or successive application.” It also ruled that Woods’s motion for a stay failed because, contrary to the statutory requirements, it would not “have jurisdiction to ‘entertain a habeas corpus application’” as Woods had already filed 6  Case: 20-10873 Date Filed: 03/05/2020 Page: 7 of 11 one application and had not received permission from our Court to file a second. In the afternoon on March 5, Woods filed in this Court a motion for appointment of substitute counsel and a stay, see 28 U.S.C. § 2251(a)(3). II. DISCUSSION Federal law permits a federal court to stay the execution of a state prisoner who applies for appointment of counsel, 18 U.S.C. § 3599(a)(2), if the court “would have jurisdiction to entertain a habeas corpus application regarding [the prisoner’s] sentence.” 28 U.S.C. § 2251(a)(3). Woods’s entitlement to the appointment of counsel and to the stay depend on equitable considerations, Martel v. Clair, 565 U.S. 648 , 663 (2012); In re Holladay, 331 F.3d 1169 , 1176 (11th Cir. 2003), and of course, if Woods is not entitled to the appointment of counsel, he is not entitled to the stay. Woods is not entitled to the appointment of substitute counsel or to the stay. A. Woods Is Not Entitled to Substitution of Counsel. Woods has not established that he is entitled to appointment of counsel under section 3599. Section 3599 permits the “replace[ment]” of counsel only when the replacement is in “the interests of justice.” 18 U.S.C. § 3599(e); Christeson v. Roper, 135 S. Ct. 373 , 894 (2015) (internal quotation marks omitted). To establish that appointment of substitute counsel is in the interest of justice, we consider the following factors: “the timeliness of the motion; the adequacy of the 7  Case: 20-10873 Date Filed: 03/05/2020 Page: 8 of 11 district court’s inquiry into the defendant’s complaint; and the asserted cause for that complaint, including the extent of the conflict or breakdown in communication between lawyer and client (and the client’s own responsibility, if any, for that conflict).” Martel, 565 U.S. at 663 . Woods has failed to establish that appointing new counsel is in the interest of justice. Woods is currently represented by counsel. His current counsel represented him in his initial habeas proceeding and continues to represent him in a separate lawsuit, and Woods has not asserted that his counsel has a conflict of interest that would preclude him from bringing the claims he says his new counsel should bring. Cf. Christeson, 135 S. Ct. at 894 (“The court’s principal error was its failure to acknowledge [present counsels’] conflict of interest.”). Woods asserts that his new counsel “indicated to clemency counsel that he had no intention of pursuing any other actions in Mr. Woods’s case when certiorari was denied and the State requested an execution date be set.” But his counsel has not so much as “indicated” to this Court that he is seeking to withdraw, and he is statutorily required to continue to represent Woods through “all available post-conviction process.” See 18 U.S.C. § 3599(e). The untimeliness of Woods’s request also precludes appointment of counsel. “Protecting against abusive delay is an interest of justice. Because that is so, courts addressing substitution motions in both capital and non-capital cases routinely 8  Case: 20-10873 Date Filed: 03/05/2020 Page: 9 of 11 consider issues of timeliness.” Martel, 565 U.S. at 662 . Woods filed this motion only hours before his scheduled execution, despite his assertion that he has never been satisfied with his representation and that his clemency counsel discovered this purportedly new evidence in the middle of February. The Supreme Court has stressed that a district court is not required to appoint substitute counsel “just so [the prisoner] could file a futile motion.” Id. at 666; see also Brown v. United States, 720 F.3d 1316 , 1337 (11th Cir. 2013) (“Quite simply, it would have been futile for the district court to have appointed new counsel in this case . . . , and thus the district court did not abuse its discretion in denying [his counsel’s] motion to withdraw.”). Woods has failed to establish that any motion or petition that his new counsel may file would not be futile—as second or successive, untimely, procedurally defaulted, or meritless. See Woods v. Holman, 2019 WL 5866719 . B. Woods Is Not Entitled to a Stay. To determine whether Woods is entitled to a stay under section 2251, we consider four factors: “[w]hether the movant has made a showing of likelihood of success on the merits and of irreparable injury if the stay is not granted, whether the stay would substantially harm other parties, and whether granting the stay would serve the public interest.” In re Holladay, 331 F.3d at 1176 (alteration and internal quotation marks omitted). 9  Case: 20-10873 Date Filed: 03/05/2020 Page: 10 of 11 To establish a substantial likelihood of success on the merits, Woods must identify a “merits-based claim going to the validity of his convictions, death sentence, or imminent execution that would provide a substantial ground on which to grant federal habeas relief.” Chavez v. Sec’y, Fla. Dep’t of Corr., 742 F.3d 940 , 947 n.5 (11th Cir. 2014). As we previously explained, Woods has not established a substantial likelihood of success on the merits of any future motion or habeas application. In considering the factors of harm to other parties and the public interest, we must be mindful of a prisoner’s unjustified delay in seeking a stay of execution. The Supreme Court has made clear that “[l]ast-minute stays should be the extreme exception, not the norm, and the last-minute nature of an application that could have been brought earlier, or an applicant’s attempt at manipulation, may be grounds for denial of a stay.” Bucklew v. Precythe, 139 S. Ct. 1112 , 1134 (2019) (internal quotation marks omitted). For example, the Supreme Court has vacated a grant of a motion to stay filed 10 days before the prisoner’s scheduled execution because of the “last-minute nature” of the application. Dunn v. Ray, 139 S. Ct. 661 (2019) (mem.) (internal quotation marks omitted). Woods has utterly failed to justify his extreme delay in filing this motion for a stay. As Woods’s first habeas application makes clear, Woods was aware of purported deficiencies with his trial counsel for years. We denied a certificate of 10  Case: 20-10873 Date Filed: 03/05/2020 Page: 11 of 11 appealability to challenge those alleged deficiencies over a year ago, and the Supreme Court declined to review that decision. Even considering the purportedly new evidence that Woods’s clemency counsel describes in the affidavit attached to his motion, Woods has still inexcusably delayed because that evidence was largely discovered by mid-February. He has failed to explain why, after learning of this evidence, he waited until two days before his execution to file his motion in the district court, then waited nearly 24 hours to challenge the district court’s denial, and only now seeks a motion for a stay in this Court. Woods’s abusive delay means that he cannot obtain a stay. III. CONCLUSION We DENY the motion for appointment of counsel and for a limited stay. 11

2020-03-06 00:00:40.910907+00

https://ecf.dcd.uscourts.gov/cgi-bin/show_public_doc?2017cv0437-46

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA _________________________________________ ) CAROL ROSENBERG, et al., ) ) Plaintiffs, ) ) v. ) Case No. 17-cv-00437 (APM) ) U.S. DEPARTMENT OF DEFENSE, ) ) Defendant. ) _________________________________________ ) MEMORANDUM OPINION AND ORDER I. INTRODUCTION This action arises from a Freedom of Information Act (“FOIA”) request submitted by Plaintiffs Carol Rosenberg and Miami Herald Media Company to the United States Department of Defense (“DOD”). Plaintiffs seek the disclosure of emails sent by retired Marine Corps General John F. Kelly pertaining to the Joint Task Force Guantánamo (“JTF-GTMO”), a military task force based in Guantánamo Bay, Cuba. DOD initially refused Plaintiffs’ request for expedited processing, and Plaintiffs filed the instant lawsuit on March 10, 2017. After an initial round of summary judgment briefing, the court found that DOD had not properly justified withholding certain responsive information under Exemptions 1 and 5 of FOIA. The parties’ renewed cross- motions for summary judgment and Plaintiffs’ motion for partial reconsideration are now before the court. For the reasons set forth below, the court grants in part and denies in part Defendant’s Motion for Summary Judgment and grants in part and denies in part Plaintiffs’ Cross-Motion for Summary Judgment and Partial Reconsideration. II. BACKGROUND A. Rosenberg’s FOIA Request For the better part of two decades, Plaintiff Rosenberg, a reporter for the Miami Herald, has reported extensively on the U.S. Southern Command (“SOUTHCOM”)—a component of DOD responsible for American military operations in Central America, South America, and the Caribbean—including the Guantánamo Bay detention center. Compl., ECF No. 1 [hereinafter Compl.], ¶¶ 7, 10. Rosenberg’s reporting covered, among other things, General Kelly’s career during the years he oversaw operations at Guantánamo. Id. Shortly after the 2016 presidential election, Rosenberg sent a FOIA request to DOD seeking: “[A]ll emails by the former [SOUTHCOM] commander retired Marine Gen. John F. Kelly to Lisa Monaco [the former Assistant to President Obama for Homeland Security and Counterterrorism] or those that also copied her on his correspondence.” Compl., Ex. A, ECF No. 1-1. The DOD denied Rosenberg’s request for expedited processing and did not respond to her administrative appeal. See Compl. ¶¶ 12–20. B. Procedural Background After Plaintiffs filed this lawsuit on March 10, 2017, see generally Compl., DOD produced to Plaintiffs 256 emails and 92 attachments totaling 548 pages, and invoked FOIA Exemptions 1, 3, 5, 6, and 7(E) for various withholdings, see Third Joint Status Report, ECF No. 15, ¶¶ 3–4. DOD filed a motion for summary judgment in October 2017, see Def.’s Mot. for Summ. J., ECF No. 18 [hereinafter Def.’s First Mot.]. The motion was supported by the declaration of Brigadier General Todd J. McCubbin, the Reserve Deputy Director of SOUTHCOM, see id., Decl. of Todd J. McCubbin, ECF No. 18-2 [hereinafter McCubbin Decl.], as well as a Vaughn Index, see id., Ex. 4 [hereinafter Vaughn Index]. Plaintiffs filed a cross-motion for summary judgment 2 the following month, see Pls.’ Cross-Mot. for Summ. J., ECF No. 19, Mem. in Supp. of Cross- Mot., ECF No. 19-1 [hereinafter Pls.’ First Mot.]. Plaintiffs also asked the court to conduct an in camera review of a representative sample of the documents at issue, see id. at 42–43, which the court agreed to do, see Minute Order, Aug. 22, 2018. 1 Briefing in the matter completed in January 2018, see Pls.’ Reply in Further Supp. of Pls.’ First Mot., ECF No. 24 [hereinafter Pls.’ First Reply]. The court entered a Memorandum Opinion and Order on September 27, 2018, finding that DOD had appropriately invoked FOIA Exemptions 3, 6, and 7(e). See Mem. Op. & Order, ECF No. 27 [hereinafter Mem. Op.], 33–43. The court denied DOD’s motion as to most Exemption 1 withholdings and all Exemption 5 withholdings, see id. at 9–33, as explained in greater detail below. The court afforded DOD an opportunity to provide supplemental declarations to support its withholdings under both exemptions. Id. On November 21, 2018, DOD filed a renewed motion for summary judgment with respect to its Exemption 5 withholdings and certain Exemption 1 withholdings. See Def.’s Renewed Mot. for Summ. J., ECF No. 31, Mem. of P&A, ECF No. 31-1 [hereinafter Def.’s Renewed Mot.]. In support of its renewed motion, DOD submitted a supplemental declaration from John Mulkeen, a deputy stationed in the SOUTHCOM Office of Operations Directorate. See id., Decl. of John Mulkeen, ECF No. 31-2 [hereinafter Mulkeen Decl.]. DOD also submitted ex parte a classified and sealed supplemental declaration. See Def.’s Renewed Mot. at 2–3. Plaintiffs filed a renewed cross-motion for summary judgment and a motion for partial reconsideration on January 4, 2019. See Pls.’ Renewed Cross-Mot. for Summ. J. & Partial Recons., ECF No. 34, Mem. in Opp’n to 1 The court reviewed in camera Records 31, 72, 129, 140, 168, 240, 248, 265, 278, 281, 288, 295, 297, 307, 317, 320, 321, 326, 328, 331, and 335. 3 Def.’s Renewed Mot. & in Supp. of Pls.’ Renewed Cross-Mot., ECF No. 34-1 [hereinafter Pls.’ Renewed Mot.]. Briefing concluded on March 8, 2019. See Pls.’ Reply in Supp. of Pls.’ Renewed Mot., ECF No. 43 [hereinafter Pls.’ Renewed Reply]. III. LEGAL STANDARD “Unlike the review of other agency action that must be upheld if supported by substantial evidence and not arbitrary or capricious, the FOIA expressly places the burden ‘on the agency to sustain its action’ and directs the district courts to ‘determine the matter de novo.’” U.S. Dep’t of Justice v. Reporters Comm. for Freedom of Press, 489 U.S. 749 , 755 (1989) (quoting 5 U.S.C. § 552(a)(4)(B)). As a general matter, “[i]n FOIA cases, an agency defendant may be entitled to summary judgment if it can demonstrate that (1) no material facts are in dispute, (2) it has conducted an adequate search for responsive records, and (3) each responsive record that it has located has either been produced to the plaintiff, is unidentifiable, or is wholly exempt from disclosure.” Mattachine Soc’y of Wash., D.C. v. U.S. Dep’t of Justice, 267 F. Supp. 3d 218 , 223 (D.D.C. 2017) (citing Weisberg v. U.S. Dep’t of Justice, 705 F.2d 1344 , 1350–51 (D.C. Cir. 1983)). If an agency invokes a FOIA exemption to withhold information, it must, by declaration or otherwise, “describe the [withheld] documents and the justifications for nondisclosure with reasonably specific detail” and “demonstrate that the information withheld logically falls within the claimed exemption.” Military Audit Project v. Casey, 656 F.2d 724 , 738 (D.C. Cir. 1981). “To successfully challenge an agency’s showing that it complied with the FOIA, the plaintiff must come forward with ‘specific facts’ demonstrating that there is a genuine issue with respect to whether the agency has improperly withheld extant agency records.” Span v. U.S. Dep’t of Justice, 696 F. Supp. 2d 113 , 119 (D.D.C. 2010) (quoting U.S. Dep’t of Justice v. Tax Analysts, 492 U.S. 136 , 142 (1989)). “Ultimately, an agency’s justification for invoking a FOIA exemption is 4 sufficient if it appears logical or plausible.” Judicial Watch, Inc. v. U.S. Dep’t of Def., 715 F.3d 937 , 941 (D.C. Cir. 2013) (internal quotation marks omitted). IV. DISCUSSION The parties’ remaining disputes center on the applicability of Exemptions 1 2 and 5. The court addresses each in turn. A. Exemption 1 FOIA Exemption 1 precludes disclosure of documents that are: “(A) specifically authorized under criteria established by an Executive order to be kept secret in the interest of national defense or foreign policy and (B) are in fact properly classified pursuant to such Executive order[.]” 5 U.S.C. § 552(b)(1). DOD invoked Executive Order 13,526, 75 Fed. Reg. 707 (Dec. 29, 2009) (“EO 13,526”)—the relevant Executive Order governing the classification of national security information—as the basis for its redaction of various records produced to Plaintiffs. See Def.’s Renewed Mot. at 5–6. EO 13,526 provides that information may be classified if, among other things, the information “reasonably could be expected to result in damage to the national security.” EO 13,526 § 1.1(a). DOD withheld information pertaining to four categories of information that EO 13,526 deems to be classified: (1) “military plans, weapons systems, or operations,” id. § 1.4(a); (2) “foreign government information,” id. § 1.4(b); (3) “intelligence sources or methods,” id. § 1.4(c); and certain (4) “vulnerabilities or capabilities” relating to national security, id. § 1.4(g). 2 The parties have conceded several outstanding issues with respect to Exemption 1. First, DOD concedes that, with the exception of a detainee movement order number, it improperly withheld information pertaining to congressional matters from Records 272 and 304. See Def.’s Renewed Mot. at 10; Mulkeen Decl. ¶¶ 8–9. Plaintiffs do not challenge DOD’s withholding of the detainee movement order number. See Pls.’ Renewed Mot. at 31 n.3. Second, Plaintiffs now concede that DOD properly redacted information from Record 273 that was provided by a foreign government to the U.S. government with the expectation that it would not be publicly released. See id. at 32 n.4. 5 DOD now renews its motion for summary judgment with respect to its withholdings under the two remaining disputed categories: (1) “military plans, weapons systems, or operations”; and (2) “intelligence sources or methods.” 1. Section 1.4(a): Military plans, weapon systems, or operations DOD withheld under EO 13,526 § 1.4(a) records concerning “operational details about JTF-GTMO, particularly detention operations.” McCubbin Decl. ¶ 19. Only two subcategories of these records—records pertaining to detainee health and records regarding detainee movements—are still in dispute. a. Detainee Health DOD withheld information pertaining to detainee health and hunger strikes, wherein General Kelly “discuss[es] in broad and specific terms detainees’ mental, physical, and emotional health, as well as the measures . . . being developed or taken to ensure their wellbeing,” McCubbin Decl. ¶ 23, and identifies “the number of hunger strikers” and “the impact . . . the strike is having on detainees’ health,” id. ¶ 26. In their initial motion for summary judgment, Plaintiffs sought release on the grounds that much of the information—including the number of hunger strikers— had been officially disclosed. See Mem. Op. at 21–22. Plaintiffs also argued that these official disclosures undermined the DOD’s objections that the release of similar information reasonably could be expected to harm national security. Id. at 22. In its earlier opinion, the court found that “Plaintiffs fail[ed] to show that any of the information identified has been disclosed in a manner that allows them to overcome the agency’s invocation of Exemption 1,” id. at 22, and “easily reject[ed] Plaintiffs’ related assertion that the release of similar information to that withheld here somehow lessens the risk of harm to the national security resulting from disclosure of information relating to detainee health and the 6 controversial enteral feeding program,” id. at 25. 3 However, the court granted Plaintiffs’ motion for summary judgment as to a May 15, 2013 tally of hunger strikers and tube-fed detainees reported on the Miami Herald website. The court found that the figure was derived from the public statement of JTF-GTMO spokesman Army Lt. Col. Samuel House and was “thus ‘officially acknowledged’ such that DOD may not withhold the number of hunger strikers and force-fed detainees for the date of May 15, 2013.” Id. at 23–24 n.9. 4 Regarding the other figures reported on the Miami Herald website, though, the court concluded that “Plaintiffs have failed to bring to the court’s attention the specific official disclosures that support each count in the tally,” and accordingly had “not met their burden to prove that these figures are ‘official disclosures’ that overcome DOD’s invocation of Exemption 1.” Id. Plaintiffs now seek reconsideration of the court’s earlier order on the basis that a new declaration confirms the tallies reported in the Miami Herald were “obtained exclusively from official government sources.” Pls.’ Renewed Mot. at 38; see also id., Decl. of Carol Rosenberg, ECF No. 34-2 [hereinafter Rosenberg Decl.]. Plaintiffs argue that, like the May 15, 2013 tally, “the number of hunger strikers and force-fed detainees at Guantánamo between March and December 2, 2013, has been officially acknowledged and may not properly be withheld.” Pls.’ Renewed Mot. at 38. The court agrees. As a threshold matter, DOD contends that reconsideration is unwarranted because the new “evidence . . . was available to Plaintiff[s] well in advance of the court’s [September 2018] ruling.” 3 Though the court did not expressly grant Defendants’ motion for summary judgment as to this information, that was the court’s clear intent. 4 Under FOIA, the government cannot withhold information that it has already officially acknowledged. Information is officially acknowledged if: “(1) the information requested [is] as specific as the information previously released; (2) the information requested . . . match[es] the information previously disclosed; and (3) the information requested . . . already ha[s] been made public through an official and documented disclosure.” ACLU v. U.S. Dep’t of Def., 628 F.3d 612 , 620–21 (D.C. Cir. 2011). 7 Def.’s Reply in Supp. of Summ J. & Mem. in Opp’n to Pls.’ Renewed Mot., ECF No. 40 [hereinafter Def.’s Renewed Reply], at 11 (alterations in original) (quoting Koch v. Clayton, No. 12-cv-1934 (APM), 2017 WL 2389921 , at *1 n.3 (D.D.C. June 1, 2017)). This issue is governed by Federal Rule of Civil Procedure 54(b), which provides that an interlocutory order “may be revised at any time before the entry of a judgment adjudicating all the claims and all the parties’ rights and liabilities.” Fed. R. Civ. P. 54(b). Rule 54(b) “recognizes [the court’s] inherent power to reconsider an interlocutory order ‘as justice requires.’” Capitol Sprinkler Inspection, Inc. v. Guest Servs., Inc., 630 F.3d 217 , 227 (D.C. Cir. 2011) (quoting Greene v. Union Mut. Life Ins. Co. of Am., 764 F.2d 19 , 22–23 (1st Cir. 1985) (Breyer, J.)). Because reconsideration of an interlocutory order does not implicate the same finality and judicial resource concerns as the reconsideration of a final order, the Rule 54(b) standard is “more flexible” than Rule 59(e), which governs the reconsideration of final judgments. Cobell v. Jewell, 802 F.3d 12 , 25 (D.C. Cir. 2015). While Rule 59(e) motions ordinarily cannot be used to “raise arguments or present evidence that could have been raised before the entry of judgment,” id. (internal quotation marks omitted), Rule 54(b) contains no such “strict prohibition,” id. at 26; see also Pinson v. U.S. Dep’t of Justice, 396 F. Supp. 3d 66 , 76 (D.D.C. 2019) (noting that “a trial court has more discretion in applying Rule 54(b) than it does under Rule[] 59(e)”). Thus, the court may grant a Rule 54(b) motion for reconsideration so long as there are “good reasons for doing so,” United States v. All Assets Held at Bank Julius Baer & Co., Ltd., 308 F. Supp. 3d 186 , 193 (D.D.C. 2018) (quoting Cobell v. Norton, 355 F. Supp. 2d 531 , 540 (D.D.C. 2005)), such as where the court failed to consider “data[] that might reasonably be expected to alter the conclusion reached by the court,” Singh v. George Washington Univ., 383 F. Supp. 2d 99 , 101 (D.D.C. 2005) (internal quotation marks omitted), or where the movant presents new 8 information that “constitute[s] a change in the court’s awareness of the circumstances,” even though it “may not constitute a change in the actual facts of the case,” Judicial Watch v. U.S. Dep’t of Army, 466 F. Supp. 2d 112 , 124 (D.D.C. 2006). Reconsideration is warranted here. In their previous motion, Plaintiffs cited to a Miami Herald database that tracked the daily number of hunger strikers and instances of force-feeding between March and December 2013. Pls.’ First Mot. at 26. In support of their argument that all these tallies were officially acknowledged, Plaintiffs identified—as a representative example—the March 13, 2013 tally, which was derived from a statement of an official DOD spokesperson. See Pls.’ First Reply at 14. The court agreed that the May 13 tally was officially acknowledged, but it could not confirm whether the remaining tallies in the database were likewise officially disclosed. Mem. Op. at 24 n.9. Carol Rosenberg’s new declaration confirms, and DOD does not dispute, that “[e]very single data point in [the database] was obtained directly from an official in the Department of Defense who was authorized to disclose publicly the number of hunger strikers and forced feedings.” Rosenberg Decl. ¶ 14; see also id., Exhibit C, ECF No. 34-5 [hereinafter Ex. C] (providing 218 email chains in which various DOD officials conveyed the current tally of hunger strikers and instances of force-feeding during the period from March 19, 2013 to December 2, 2013). This additional information constitutes a “change in the court’s awareness of the circumstances,” Judicial Watch, 466 F. Supp. 2d at 124 , which “might reasonably be expected to alter the conclusion reached by the court,” Singh, 383 F. Supp. 2d at 101 . The flexible threshold for interlocutory reconsideration is therefore satisfied. DOD would have the court deny reconsideration because Plaintiffs have not identified any “new evidence” that was not previously available to it, see Def.’s Renewed Reply at 10–13, but the court fails to see how “justice requires” 9 such a result. In their earlier briefing, Plaintiffs clearly intended to demonstrate that all of these records had been officially disclosed, and now they have provided concrete evidence demonstrating as much. Furthermore, denying reconsideration would seem particularly unjust given that the court has given DOD the opportunity to supplement the record with information that was likewise available to the agency during the previous round of briefing. Accordingly, the court grants Plaintiffs’ motion for partial reconsideration. On the merits, DOD contends that disclosure is unwarranted because Plaintiffs have not demonstrated that there is an exact match between the information requested and information that has been officially disclosed. Id. at 11–12; see also Dongkuk Int’l, Inc. v. U.S. Dep’t of Justice, 202 F. Supp. 3d 18 , 29 (D.D.C. 2016) (explaining that, to invoke the official acknowledgment exception, plaintiffs must show that “the information previously disclosed is as specific as, or matches, the information that they now demand”). That argument is easily disposed of. DOD has withheld these records on the grounds that they identify “the number of hunger strikers” and enteral feeders at Guantánamo Bay. See McCubbin Decl. ¶ 26. The majority of these records are dated between the spring and winter of 2013, see Vaughn Index—the same timeframe during which the government routinely disclosed official tallies of hunger strikes, see Rosenberg Decl. ¶¶ 4, 10; Ex. C. The court already found that DOD must disclose “the number of hunger strikers and force- fed detainees for the date of May 15, 2013,” because the official disclosure of those tallies was as specific as, and matched the information Plaintiffs sought. See Mem. Op. at 24 n.9. The same is true of DOD’s official disclosures as to all other tallies in this timeframe. See Pls.’ Renewed Mot. at 38 (requesting disclosure of “the number of hunger strikers and force-fed detainees at Guantánamo between March and December 2, 2013”). Accordingly, DOD may not withhold 10 information pertaining to the number of hunger strikers and force-fed detainees at Guantánamo Bay between March 19, 2013, and December 2, 2013. b. Detainee Movements to Third Countries DOD withheld information relating to detainees’ movements to third countries, reasoning that release of this information could “enable interference in future or similar operations,” and could inhibit the government’s ability to continue cooperating with foreign governments in these operations. McCubbin Decl. ¶ 28. In its earlier opinion, the court denied DOD’s motion for summary judgment as to one sub-category of information regarding detainee movements to third countries: documents detailing the “reactions of the detainees upon learning of their transfer.” See Mem. Op. at 26. The court found that the connection between releasing this information and the risks to national security and international cooperation was “tenuous at best,” but allowed DOD to submit a supplemental declaration indicating whether “the redacted information about the reactions of detainees is too intertwined with other withheld information” to be released. Id. DOD has now submitted such a declaration, confirming that this information has been withheld not because it is itself classified, but because “it is too intertwined with other withheld information that is properly and currently classified.” See Mulkeen Decl. ¶ 6. According to Deputy Mulkeen, “information detailing detainee reactions is part of a larger discussion regarding detainee movements” in each of the withheld records, and, “in many of these records, detainees’ reactions are discussed within the context of how the news of their transfer is or could impact detainee operations as well as interagency discussions concerning tentative, planned or pending transfers.” Id. ¶ 7. By way of example, Deputy Mulkeen states that in Record 331, “General Kelly, in three sentences, identifies a detainee, his nationality, when he was notified, when he is being transferred and to where he is being transferred, and the impact the news of his transfer could have 11 on detention operations.” Id. Release of these details, Deputy Mulkeen opines, could “compromise future transfers.” Id. Plaintiffs counter that the Mulkeen declaration does not “adequately explain[]” why General Kelly’s discussions of detainees’ reactions cannot be segregated from classified information. Pls.’ Renewed Mot. at 34. In addition, Plaintiffs argue that the withholdings in Record 331 do not appear to be representative of the DOD’s other withholdings in this category, and that DOD should have provided “document-by-document” support for each of its withholdings. Id. At a minimum, Plaintiffs request that the court conduct an in camera review of the withheld documents to weigh the DOD’s claim of non-segregability. Id. The D.C. Circuit “has long recognized . . . that documents may be withheld,” in part or in full, when nonexempt portions “are inextricably intertwined with exempt portions.” Juarez v. U.S. Dep’t of Justice, 518 F.3d 54 , 61 (D.C. Cir. 2008) (quoting Mead Data Cent., Inc. v. U.S. Dep't of Air Force, 566 F.2d 242 , 260 (D.C. Cir. 1977)). However, “[a] blanket declaration that all facts are so intertwined to prevent disclosure under the FOIA does not constitute a sufficient explanation of non-segregability.” Defs. of Wildlife v. U.S. Border Patrol, 623 F. Supp. 2d 83 , 90 (D.D.C. 2009) (quoting Wilderness Soc’y v. U.S. Dep’t of Interior, 344 F. Supp. 2d 1 , 19 (D.D.C. 2004)). To meet its burden, the government must show “with reasonable specificity why documents withheld pursuant to a valid exemption cannot be further segregated for this reason.” Juarez, 518 F.3d at 61 . The government is “entitled to a presumption that [it] complied with the obligation to disclose reasonably segregable material,” which can be overcome by contrary evidence produced by the plaintiff. Sussman v. U.S. Marshals Serv., 494 F.3d 1106 , 1117 (D.C. Cir. 2007). DOD has satisfactorily demonstrated why the withheld information pertaining to detainees’ reactions cannot be segregated from otherwise classified materials. Contrary to Plaintiffs’ 12 contentions, the Mulkeen Declaration explains, with sufficient specificity, that this information cannot be segregated because it “is part of a larger discussion regarding detainee movements” and is generally discussed “within the context of how the news of their transfer is or could impact detainee operations” and future transfers. Mulkeen Decl. ¶¶ 6–7. Plaintiffs take issue with the fact that the declaration does not explain why DOD cannot redact “(a) the name of the detainee, (b) his nationality, (c) the date of his notification, (d) the date of his transfer, (e) the detainee’s destination, and (f) the impact of the news on detention operations, while disclosing the detainee’s reaction,” Pls.’ Renewed Mot. at 34, but to do so in such granular detail would require DOD to discuss the very information that Plaintiffs concede is properly classified. The government’s burden is not so demanding. In addition, based on the court’s in camera review of Record 331, the court confirms that the information is indeed too intertwined with other properly classified information to be segregated. Plaintiffs question whether detainee reaction information in the other disputed records is similar in kind to Record 331, noting that the McCubbin Declaration does not specifically identify Record 331 as discussing the reaction of detainees upon learning of their transfer. See Pls.’ Renewed Mot. at 34 (citing McCubbin Decl. ¶ 27). There is no reason to doubt the representativeness of Record 331, however. Both the McCubbin and Mulkeen Declarations identically characterize this category of information as discussing “the reactions of the detainees upon learning of their transfer.” Compare McCubbin Decl. ¶ 27, with Mulkeen Decl. ¶ 6. The McCubbin Declaration’s omission of Record 331 from this list thus appears to have been merely an oversight. Plaintiffs also challenge the government’s alleged failure to “provide document-by- document support for each of its withholdings,” see Pls.’ Renewed Mot. at 34, but they overlook the fact that the DOD conducted a “line-by-line” segregability review, making “[e]very effort” to 13 “segregate releasable material from exempt material,” McCubbin Decl. ¶¶ 78–79. Plaintiffs do not point to any contrary evidence sufficient to overcome the “presumption that [the government] complied with the obligation to disclose reasonably segregable material.” See Sussman, 494 F.3d at 1117 . Therefore, the court grants DOD’s motion for summary judgment as to this category of information. 2. Section 1.4(c) “Intelligence Activities, Sources, or Methods” DOD withheld information in 12 records pursuant to section 1.4(c), which allows classification of information that “pertains to . . . intelligence activities (including covert action), intelligence sources or methods, or cryptology.” EO 13,526 § 1.4(c); see McCubbin Decl. ¶ 36. The court originally denied summary judgment to DOD as to this category of information, noting that DOD’s public declarations did not contain sufficient detail to permit the court to conclude “that the information withheld involves intelligence ‘activities,’ ‘sources,’ or ‘methods,’” or that its release would “reasonably be expected to cause damage to the national security.” Mem. Op. 32 (quoting EO 13,526 § 1.4(c)). The court allowed DOD an opportunity to submit a supplemental classified declaration for ex parte, in camera review. Id. DOD has now submitted the classified declaration of John Mulkeen for the court’s review, which DOD contends, “describes each of the disputed records in greater detail, explains how each record pertains to intelligence activities, and explains the damage to national security from their release.” Def.’s Renewed Mot. at 12. As a threshold matter, Plaintiffs object to DOD’s ex parte submission, noting that “it is not at all apparent why the government cannot provide some public version of its supplemental account.” Pls.’ Renewed Mot. at 35. Plaintiffs correctly observe that even when an agency appropriately submits a declaration ex parte, it is “still required to provide as much public explanation as it can without ‘giving away the information it is trying to withhold.’” Roth v. U.S. 14 Dep’t of Justice, 642 F.3d 1161 , 1185 (D.C. Cir. 2011) (quoting Lykins v. U.S. Dep’t of Justice, 725 F.2d 1455 , 1464 (D.C. Cir. 1984)). However, Plaintiffs overlook that DOD has done just that. DOD already submitted an unclassified declaration on the public docket to explain the basis for its § 1.4(c) withholdings, see McCubbin Decl. ¶ 36. The court previously concluded that the McCubbin Declaration provided insufficient information for the court to evaluate the withholdings, and it provided DOD with the opportunity to submit a classified ex parte declaration. See Mem. Op. at 32. DOD has thus fulfilled its obligation to provide “as much public explanation as it can.” Roth, 642 F.3d at 1185 . On the merits, Plaintiffs renew their contention that the withheld information is not properly classified, questioning both whether the withheld information “pertain[s] to ‘intelligence activities’ subject to classification under § 1.4(c),” and whether release of such information could reasonably be expected to cause serious damage to the national security. See Pls.’ Renewed Mot. at 36. Based on its in camera review of Deputy Mulkeen’s classified declaration, and the “deferential posture” the court must assume when evaluating an agency’s withholding of classified information, see Larson v. U.S. Dep’t of State, 565 F.3d 857 , 865 (D.C. Cir. 2009), the court rejects Plaintiffs’ contentions. Deputy Mulkeen’s declaration spells out, in significant detail, how the withheld information in each record pertains to intelligence activities, sources, or methods, and how release of that information would reasonably be expected to cause damage to the national security. Therefore, the court grants DOD’s motion for summary judgment as to this category of information. B. Exemption 5 Exemption 5 exempts from disclosure “inter-agency or intra-agency memorandums or letters that would not be available by law to a party other than an agency in litigation with the 15 agency.” 5 U.S.C. § 552(b)(5). Exemption 5 incorporates all the privileges that the government may claim when litigating against a private party, including the deliberative process privilege. Abtew v. U.S. Dep’t of Homeland Sec., 808 F.3d 895 , 898 (D.C. Cir. 2015). The deliberative process privilege “rests on the obvious realization that officials will not communicate candidly among themselves if each remark is a potential item of discovery and front page news.” U.S. Dep’t of Interior v. Klamath Water Users Protective Ass’n, 532 U.S. 1 , 8–9 (2001). To qualify for the privilege, the withheld information must be “both pre-decisional and deliberative.” See Abtew, 808 F.3d at 898 . “A document is predecisional if it precedes, in temporal sequence, the decision to which it relates . . . [a]nd a document is deliberative if it is a part of the agency give-and-take— of the deliberative process—by which the decision itself is made.” Id. at 898–99 (internal quotation marks and citations omitted). Because Exemption 5 is a discretionary exemption, an agency may withhold information—even if it falls within the four corners of the exemption—“only if . . . the agency reasonably foresees that disclosure would harm an interest protected by” an applicable FOIA exemption. See 5 U.S.C. § 552(a)(8)(A)(i)(I); S. REP. NO. 114-4, at 8 (2015) (noting that “[t]he foreseeable harm standard applies only to those FOIA exemptions under which discretionary disclosures can be made”). DOD withheld under Exemption 5 information from a number of records, but it only “perfunctorily state[d] that disclosure of all the withheld information—regardless of category or substance—‘would jeopardize the free exchange of information between senior leaders within and outside of the [DOD].’” See Mem. Op. at 14 (quoting McCubbin Decl. ¶ 62). Because DOD had failed to “explain how a particular Exemption 5 withholding would harm the agency’s deliberative process,” the court denied DOD’s motion for summary judgment as to this information. Id. at 12– 15. In lieu of granting summary judgment in favor of Plaintiffs on this issue, though, the court 16 granted DOD an opportunity to supplement the record with an explanation as to why its withholdings satisfy the “foreseeable harm standard.” Id. at 14–15. DOD could take a “categorical approach—that is, group together like records,” the court explained, “but in that case, it must explain the foreseeable harm of disclosure for each category.” Id. at 12. In addition, the court addressed Plaintiffs’ challenge that DOD had “failed to identify the specific, predecisional deliberative process[es] to which certain of [its] withholdings relate.” Id. at 16. The court conducted an in camera review of a sample of documents and “substantiated only one [of Plaintiffs’ challenges]: the assertion that General Kelly’s opinions about the merits of a judicial ruling are not properly withheld as predecisional deliberative process.” Id. “In light of the sensitivity of these records,” however, the court granted DOD a subsequent opportunity “to explain why the records fall within Exemption 5’s ambit.” Id. at 17. The parties have now renewed their arguments with respect to the reasonable foreseeability of harms associated with release of these records and whether General Kelly’s discussions of the judicial ruling properly fall within Exemption 5. The court addresses the two issues in reverse order. 5 1. Whether General Kelly’s Opinions Regarding the Commission Ruling Are Predecisional and Deliberative “To gauge whether the deliberative-process privilege has been asserted appropriately, the government must explain, for each withheld record, at least, (1) what deliberative process is involved, (2) the role played by the documents in issue in the course of that process, and (3) the 5 See Ctr. for Investigative Reporting v. U.S. Customs & Border Prot., No. CV 18-2901 (BAH), 2019 WL 7372663 , at *4 (D.D.C. Dec. 31, 2019) (explaining that the applicability of the claimed exemption should ordinarily be considered “first, before turning to foreseeable harm,” because “the grant of summary judgment is inappropriate to any party unless the court is assured the record justifies” the government’s invocation of the exemption). 17 nature of the decisionmaking authority vested in the office or person issuing the disputed documents, and the positions in the chain of command of the parties to the documents.” Ctr. for Investigative Reporting v. U.S. Customs & Border Prot., No. CV 18-2901 (BAH), 2019 WL 7372663 , at *4 (D.D.C. Dec. 31, 2019) (cleaned up) (quoting Ctr. for Biological Diversity v. EPA, 279 F. Supp. 3d 121 , 147 (D.D.C. 2017)). In this case, DOD redacted various records in which “General Kelly provides his opinions about” a military commission ruling barring female guards from touching certain detainees. McCubbin Decl. ¶ 54. After conducting an in camera review of certain of these records, the court “agree[d] with Plaintiffs that some of the withheld information involves General Kelly merely ‘opining about the merits’ of the military commission ruling in a manner that is not directed toward decision-making as to law or policy,” which the court noted is not “subject to the deliberative process privilege.” Mem. Op. at 16. The court also observed that DOD inconsistently withheld these records, leaving unredacted certain records documenting General Kelly’s frustration with the slow progress of the military commission, yet redacting similar discussions in other records. Id. In the government’s new declaration, Deputy Mulkeen states that the records reflect General Kelly’s consideration of “various options in relation to the military commission’s temporary order.” Mulkeen Decl. ¶ 12. Deputy Mulkeen acknowledges that DOD erroneously made inconsistent redactions of General Kelly’s thoughts, but states that the DOD maintains that the remaining redactions should be upheld. Id. ¶ 14. In addition, Deputy Mulkeen states that although not every record in this category explicitly contemplates a course of action, all of the withheld records are part of that deliberative process. Id. Plaintiffs find fault with Deputy Mulkeen’s declaration for three reasons. First, they argue that the declaration “fails to explain how each document withheld by the government contributed 18 to the government’s deliberations on how to respond to the ruling at issue.” Pls.’ Renewed Mot. at 30. That argument misses the mark. The declaration expressly states that the records reflect General Kelly “considering various options in relation to the military commission’s temporary order, from how to address the effects of the ruling to using other means to overturn what General Kelly believed was not only wrong but also illegal.” Mulkeen Decl. ¶ 12. While Deputy Mulkeen acknowledges that “not every Record explicitly considers a course of action,” he clarifies that “every Record is part of General Kelly’s decisionmaking process,” and that General Kelly “repeatedly addressed the ruling in his updates because he strongly felt that this was an issue that needed to be addressed at the highest levels of U.S. Government.” Id. at ¶ 14 (emphasis added). All of these withholdings are thus part of General Kelly’s decisionmaking process on how to respond to the ruling. Second, Plaintiffs argue that Deputy Mulkeen’s declaration “fails to explain the nature of General Kelly’s decisionmaking authority with respect to responding to the ruling at issue.” Pls.’ Renewed Mot. at 30. The declaration plainly states, however, that “[a]s the Combatant Commander responsible for detention operations aboard JTF-GTMO, General Kelly was considering various options in relation to the military commission’s temporary order.” Mulkeen Decl. ¶ 12. The McCubbin Declaration provides additional detail, listing the recipients of General Kelly’s emails by name and station, and explaining that the general’s “emails to this broad group reflect that a large number of senior officials were involved in setting policy at JTF-GTMO at various levels.” See McCubbin Decl. ¶ 41. DOD’s explanation is more than adequate. Third, Plaintiffs reiterate their earlier argument that many of the redactions “merely redact passages in which General Kelly opines on the merits of the ruling.” Pls.’ Renewed Mot. at 30. While it is true that this information alone is not subject to the deliberative process privilege, see 19 Mem. Op. at 16, the Mulkeen Declaration confirms that General Kelly was not just “opining or reflecting” on the ruling, see Mulkeen Decl. ¶ 12. Rather, his opinions were part of a broader deliberative process in which he was “was considering various options in relation to the military commission’s temporary order.” Id. The court has reviewed in camera a sample of these records, 6 and agrees that each record conveys information bearing on the agency’s decisionmaking process. For instance, in various records, General Kelly shares his concerns about the order’s effect on troop morale, and provides his views on the merits of the order in the context of his recommendations about how to implement and respond to the order. The court is especially cautious about exposing these deliberations to the light of day given the sensitive issues of military command and control they involve. General Kelly’s discussions about the merits of the ruling— understood in their broader context as part of the agency’s deliberations—are therefore subject to the deliberative process privilege. See Dudman Commc’ns Corp. v. U.S. Dep’t of Air Force, 815 F.2d 1565 , 1568 (D.C. Cir. 1987) (“Congress enacted Exemption 5 to protect the executive’s deliberative processes—not to protect specific materials.”). Accordingly, the information “plausibl[y]” qualifies under Exemption 5, Judicial Watch, 715 F.3d at 941 , and may be withheld so long as the agency has demonstrated its release is anticipated to cause reasonably foreseeable harm to an exemption-protected interest. 2. Satisfaction of the FOIA Improvement Act’s “Foreseeable Harm” Standard Enacted in 2016, the FOIA Improvement Act, see Pub. L. No. 114-185, 130 Stat. 538, provides that an agency may withhold information pursuant to a discretionary FOIA exemption “only if . . . the agency reasonably foresees that disclosure would harm an interest protected by [one of the nine FOIA] exemption[s],” 5 U.S.C. § 552(a)(8)(A)(i)(I). To satisfy this “heightened” 6 The court reviewed Records 281, 295, 320, 321, and 335. 20 foreseeable harm standard, Judicial Watch, Inc. v. U.S. Dep’t of Commerce (Judicial Watch I), 375 F. Supp. 3d 93 , 100 (D.D.C. 2019), an agency must “identify specific harms to the relevant protected interests that it can reasonably foresee would actually ensue from disclosure of the withheld materials” and “connect the harms in a meaningful way to the information withheld.” Ctr. for Investigative Reporting, 2019 WL 7372663 , at *9 (cleaned up) (quoting Judicial Watch, Inc. v. U.S. Dep’t of Justice (Judicial Watch II), No. CV 17-0832 (CKK), 2019 WL 4644029 , at *5 (D.D.C. Sept. 24, 2019)). “[G]eneric, across-the-board articulations of harm that largely repeat statements already found in the Vaughn Index,” id. at *9 (internal quotation marks and citation omitted), and “boilerplate,” “nebulous articulations of harm are insufficient,” Judicial Watch II, 2019 WL 4644029 , at *5. Rather, the agency must provide “context or insight into the specific decision-making processes or deliberations at issue, and how they in particular would be harmed by disclosure.” Ctr. for Investigative Reporting, 2019 WL 7372663 , at *10 (quoting Judicial Watch II, 2019 WL 4644029 , at *5). In doing so, an agency “may take a categorical approach” and “group together like records . . . but in that case, it must explain the foreseeable harm of disclosure for each category.” Mem. Op. at 12. The degree of detail necessary to substantiate a claim of foreseeable harm is context- specific. In some instances, the withheld information may be so obviously sensitive—such as the disclosure of internal deliberations between a high-ranking military commander and senior government officials about a new detention operation in the United States—that a simple statement illustrating why the privilege applies and identifying the harm likely to result from release “may be enough.” Ctr. for Investigative Reporting, 2019 WL 7372663 , at *10 (citing Mem. Op. at 14). In other instances—such as where the withheld deliberations involve more mundane, quotidian matters or the decision has already been made—more explanation may be necessary. See id. 21 (holding that it was not “axiomatic” that the disclosure of discussions involving the selection of contractors would cause foreseeable harm, since the successful bidder “ha[d] already been selected and the bids awarded”); see also Mem. Op. at 14 (writing that, “absent more detail from the agency, the court can less readily agree with the notion that disclosure of . . . seemingly more benign . . . categories of withheld deliberative information,” such as “opinions about the current state of facilities on base and recommendations and advice about maintenance issues, would reasonably result in the same level of harm to the exemption-protected interest” (internal quotation marks and citation omitted); see also S. REP. NO. 114-4, at 8 (explaining that the foreseeability of harm from disclosure will turn on the “age, content, and character” of the document in question). 7 Here, DOD has submitted the declaration of Deputy Mulkeen, which explains why, in the agency’s opinion, release of the information withheld under Exemption 5 would cause reasonably foreseeable harm to the interests protected by Exemption 5. Consistent with the court’s earlier invitation, DOD has subdivided its supplemental discussion into the following eight categories. a. Detention Operations DOD’s first Exemption 5 category consists of “predecisional, deliberative discussions of detention operations, specifically with respect to detainee conduct and the policies and actions necessary to maintain security at JTF-GTMO.” Def.’s Renewed Mot. at 16; see also McCubbin 7 Plaintiffs appear to propose a more demanding standard. For every withholding, they suggest the government must “meaningfully address” each of eight factors identified in a 1994 Department of Justice guidance document. See Pls.’ Renewed Mot. at 18; see also Pls.’ Cross-Mot. for Summ. J., ECF No. 19, Ex. U to Langford Decl., ECF No. 19-4 (citing U.S. Dep’t of Justice, OIP Guidance: Applying the “Foreseeable Harm” Standard Under Exemption 5, FOIA Update, Vol. XV, No. 2 (Jan. 1, 1994) (hereinafter “OIP Guidance”)). Those factors include: (1) the nature of the decision involved; (2) the nature of the decisionmaking process; (3) the status of the decision; (4) the status of the personnel involved; (5) the potential for process impairment; (6) the significance of any process impairment; (7) the age of information; and (8) the sensitivity of any individual record portions. See OIP Guidance. It is true that, depending on the circumstances, some or all of these factors may be relevant in making the context-specific determination that the release of withheld information is likely to cause harm to an exemption-protected interest. There is no basis in FOIA’s text or case law, however, to require an agency to mechanically recite each factor in order to meet its heightened burden under the FOIA Improvement Act. 22 Decl. ¶¶ 43–47. In these records, “General Kelly discusses various operational issues at JTF- GTMO with senior Executive Branch officials,” and provides “his opinions, views, and recommendations as part of continuous consultation with leadership about operational management.” Mulkeen Decl. ¶ 16. According to Deputy Mulkeen, disclosure of this information “would result in reasonably foreseeable harm to the agency’s deliberative process by revealing the back-and-forth consultation process about non-final operational management decisions.” Id. Such revelations would likely “inhibit[] officials from” engaging in “frank discussions about the[se] issues and exploring alternatives going forward,” which, in turn, would make it “less likely” for senior leadership “to gain the full and necessary understanding” of these issues and would “hamper agency decision-making about [these] crucial military operational issues.” Id. ¶¶ 16–17. In addition, disclosure of these discussions risks “providing the public with an erroneous understanding of agency decision-making at JTF-GTMO, revealing only a part of the overall considerations that play a role in the deliberative process for making policy about agency operations.” Id. ¶ 17. Deputy Mulkeen’s explanation provides more than adequate detail and context to satisfy the agency’s heightened burden. See Nat. Res. Def. Council v. EPA, No. 17-CV-5928 (JMF), 2019 WL 4142725 , at *5 (S.D.N.Y. Aug. 30, 2019) (finding that the foreseeable-harm requirement was satisfied where an agency gave “context for the decisionmaking processes in question and the harms that would reasonably ensue from disclosure of the material”). Plaintiffs concede that release of some of this information “might potentially suggest some foreseeable harm,” but they contend that the “great variety of different operational issues [DOD] has lumped together” do not “all present the same reasonably foreseeable harm.” Pls.’ Renewed Mot. at 17–18. For instance, Plaintiffs stress that certain records in this category also include matters seemingly unrelated to 23 detention operations, such as General Kelly’s updates to senior officials “‘about detainee . . . movements.” Id. at 17 (quoting McCubbin Decl. ¶ 45). These discussions, Plaintiffs argue, do not “pose any reasonably foreseeable harm of hampering future deliberations on ‘crucial military operational issues.’” Id. at 18 (quoting Mulkeen Decl. ¶ 17) (emphasis added). All this shows, however, is that the withheld records often involve multiple, overlapping categories of information. Compare, e.g., McCubbin Decl. ¶ 44 (identifying Record 149 as including “wide- ranging discussions about detention operations at Guantánamo Bay”), with id. ¶ 50 (listing Record 149 in the category of Detainee Movements). An agency taking a categorical approach does indeed have an obligation to “group together like records,” so that the court can be sure that the records in that category all present similar risks of harm to an exemption-protected interest, see Mem. Op. at 12 (emphasis added), but there is no reason a record cannot fall into multiple categories. Separately, Plaintiffs contend that disclosure of these records would not cause the harm DOD anticipates because the underlying decisions were “likely made years ago.” Pls.’ Renewed Mot. at 18. Plaintiffs lose sight of the fact that these are communications among the highest levels of leadership at DOD and the White House about highly sensitive operational issues at Guantánamo. Given the sensitivity of this information, the court can readily see how its release would prospectively harm agency decisionmaking, notwithstanding the fact that the records are now more than six years old. b. Detainee Health Second, DOD withheld privileged discussions pertaining to detainee health. See McCubbin Decl. ¶¶ 48–49. In these records, “General Kelly consults with senior Executive Branch officials and provides his views and recommendations about appropriate next steps with respect to detainees’ mental, physical, and emotional health.” Mulkeen Decl. ¶ 18. According to Deputy 24 Mulkeen, disclosure of this information “would harm the agency’s deliberative decision-making process by prematurely revealing the details of the consultative process on sensitive issues like detainee health and enteral feeding, thereby inhibiting the Commander of SOUTHCOM from engaging in open and frank discussions about vital issues related to detainees’ health and well- being.” Id. Deputy Mulkeen elaborates that because senior officials require the “unguarded views and recommendations of military leadership” to make “informed decisions about questions related to detainee health,” release of this information and its attendant chilling effect is likely to result in “less informed and poorer quality decisions” about these issues. Id. Plaintiffs raise similar challenges with respect to this category of information, questioning both its age and whether all of the documents withheld in this category would implicate the types of harms identified in Deputy Mulkeen’s declaration. See Pls.’ Renewed Mot. at 19–20. Once again, the court rejects these challenges. The withheld information touches on highly sensitive areas, which outweighs its relative age, and Plaintiffs have not identified any records that do not implicate the harms discussed by Deputy Mulkeen. DOD has met its burden as to this category. c. Detainee Movements Third, DOD withheld deliberations pertaining to detainee movements. See McCubbin Decl. ¶ 50. In these records, “General Kelly advises senior Executive Branch officials about logistical and operational issues related to detainee movement orders and provides his views about how to proceed, including with respect to media engagement.” Mulkeen Decl. ¶ 19. According to Deputy Mulkeen, disclosure of this information is reasonably expected to “harm the quality of agency decisionmaking” by discouraging officials from “providing the fullest possible picture about the issues at stake.” Id. Deputy Mulkeen explains that officials would be more guarded if this information were subject to public disclosure because, for instance, “commentary on 25 cooperation with a foreign government or an operational issue that should be shared with senior officials might be harmful if shared more widely.” Id. When managing detainee movements, Deputy Mulkeen elaborates, “weighing options and commenting on any potential difficulties is crucial to arriving at proper conclusions about how to implement detainee movements,” and disclosure of this information and its correspondent chilling effect would risk diminishing the free flow of information necessary to this process. Id. Echoing a familiar theme, Plaintiffs contend that the harms Deputy Mulkeen has identified do not uniformly apply to the full universe of records included in the Detainee Movement category, and they question whether the release would be harmful given the age of the records and the relatively discrete issues they concern. See Pls.’ Renewed Mot. at 21–22. Once again, the court rejects Plaintiffs’ challenges. There is no indication that release of any of these documents would not implicate the harms identified by Deputy Mulkeen, and the sensitivity of their subject matter outweighs any factors that might mitigate the harm stemming from their release. DOD has therefore met its burden with respect to the information in this category. d. Detainee Communication Policies DOD’s fourth category consists of records pertaining to detainee communication policies. McCubbin Decl. ¶ 51. “In these records, General Kelly provides opinions about detainee communications policies, discusses possible changes to those policies, and solicits input from senior government officials.” Mulkeen Decl. ¶ 20. As Deputy Mulkeen describes it, “disclosure of these records would reasonably be expected to harm the agency’s decision-making on this important policy issue” because officials would be “less open in discussing [their] views, opinions, and recommendations with the knowledge that that deliberative discourse will be released to the public.” Id. This, in turn, would reasonably be expected to result in poorer quality decisions. 26 “For example,” Deputy Mulkeen explains, “if officials are discouraged from freely presenting their views about potential problems with a detainee communications policy, it is less likely that any such problems will be addressed, resulting in an entrenchment of a current policy.” Id. Plaintiffs repeat the same counterarguments, see Pls.’ Renewed Mot. at 24, and the court rejects them for the reasons discussed above. Deputy Mulkeen’s explanation satisfies the foreseeable harm standard. e. Facilities Management The court finds otherwise with respect to DOD’s fifth category of records. This category consists of General Kelly’s “opinions and recommendations about the facilities on base and various maintenance issues.” Mulkeen Decl. ¶ 21; see also McCubbin Decl. ¶ 52. The DOD suggests that disclosure of this information could cause “injury to the agency’s decision-making” by chilling officials’ willingness to discuss maintenance and facilities issues. Mulkeen Decl. ¶ 21. Unlike the other categories, however, Deputy Mulkeen fails to connect the harm in a “meaningful way to the information withheld.” Ctr. for Investigative Reporting, 2019 WL 7372663 , at *9 (internal quotation marks omitted). For instance, Deputy Mulkeen hypothesizes that “[i]f a particular structure were in poor shape, . . . the Commander of SOUTHCOM must be free to relate his candid views about the need for maintenance in order to keep senior officials properly informed and solicit their views in order to determine the proper course of action and ensure that appropriate resources are devoted to addressing those issues.” Mulkeen Decl. ¶ 21. But Deputy Mulkeen nowhere explains why disclosure of this seemingly humdrum information is “likely”—as opposed to merely conceivable—to make the SOUTHCOM commander feel less free to convey his views on these matters in the future. See Judicial Watch I, 375 F. Supp. 3d at 101 (“The question is not whether disclosure could chill speech, but rather if it is reasonably foreseeable that it will chill 27 speech and, if so, what is the link between this harm and the specific information contained in the material withheld”). Because DOD has failed to specifically explain how disclosure of this category of Exemption 5 information will cause reasonably foreseeable harm to the agency’s decisionmaking process, the court grants Plaintiffs’ motion for summary judgment as to this category of information. f. Personnel Management The court grants DOD’s motion for summary judgment with respect to its sixth category of records—documents pertaining to personnel management. See McCubbin Decl. ¶¶ 53–54. In these records, “General Kelly discusses his opinions about the performance of personnel, pending personnel actions, and equal opportunity issues, as well as recommendations for how to handle ongoing personnel issues.” Mulkeen Decl. ¶ 22. According to Deputy Mulkeen, these records “involve frank discussions of personnel performance and problems that are conveyed to those personnel only when final.” Id. “[I]f those discussions are subject to public disclosure and thus available to the personnel under discussion,” Deputy Mulkeen explains, “a manager will be much less likely to openly discuss [similar] performance issues and sensitive personnel matters” in the future. Id. Disclosure will consequently harm agency decisionmaking on personnel issues by causing senior decision-makers to be “less informed.” Id. Additionally, disclosure could “lead to confusion about the actual reasons and rationales for personnel actions through the release of agency discussions that may not be the ultimate grounds for action.” Id. Deputy Mulkeen ’s declaration adequately identifies the harms that are reasonably foreseeable to result from disclosure of this category of information. Plaintiffs protest that any harm that could come from release of this information is already mitigated by the DOD’s withholding of the names of specific personnel and their personally identifying information under 28 Exemption 6, see Pls.’ Renewed Mot. at 25, but they incorrectly conflate the interests protected by Exemption 6 with those protected by Exemption 5. Whereas Exemption 6 protects individuals’ privacy interests, Exemption 5 protects the government’s deliberative processes. It is not difficult to see how managers at Guantánamo will be less likely to provide their frank views of personnel management issues if that information is released to the public (an Exemption 5 protected interest), even if the personally identifiable information in those discussions is withheld under Exemption 6. DOD has therefore met its burden as to this category. g. Court and Commission Proceedings The government’s seventh category includes “deliberative discussions of how to respond to a court or commission ruling or preparations for an anticipated court or commission ruling.” Mulkeen Decl. ¶ 23; see also McCubbin Decl. ¶¶ 55–56. Deputy Mulkeen identifies two harms that are reasonably foreseeable to result from disclosure of this information. First, “[b]ecause the presentation of an agency’s position at a hearing or in a filing is the final result of a deliberative decision-making process, disclosure of some of the discussions leading up to that final statement of a position would lead to confusion about the reasons and rationales supporting the agency’s position.” Mulkeen Decl. ¶ 23. Second, disclosure would likely cause officials to be concerned about “public scrutiny” over their deliberations and therefore would “unduly constrict[]” discussions among officials about how to respond to court orders. Id. This, in turn, would “harm the agency’s ability to implement a court or commission ruling” in the future. Id. Deputy Mulkeen ’s declaration satisfactorily identifies the harms the agency reasonably foresees will result from disclosure of this category of information. Apart from largely duplicative arguments that the court has already rejected, Plaintiffs offer only one counterargument. Because DOD “has not invoked the attorney-client privilege or work-product privileges that would seem to 29 more naturally capture records implicating the sort of litigation harm identified” by Deputy Mulkeen, Plaintiffs argue, “the government’s concern about harm to deliberations about an agency’s position in pending litigation does not appear to be presented here.” Pls.’ Renewed Mot. at 26. That argument is easily rejected. The deliberative-process privilege is a separate privilege from the attorney-client and work-product privileges, and the release of deliberative discussions may harm an agency’s deliberative process regardless of whether the information is also protected by these other privileges. See Hall & Assocs. LLC v. U.S. Envtl. Prot. Agency, 315 F. Supp. 3d 519 , 532 (D.D.C. 2018) (discussing the distinct interests the two privileges are designed to protect). The court therefore grants DOD’s motion for summary judgment as to this category. h. Other Issues The government’s final category is a catch-all for various types of deliberations “that arise less frequently in General Kelly’s correspondence and weekly updates.” Def.’s Renewed Mot. at 22. This category includes (1) General Kelly’s deliberative discussions about visits to Guantánamo Bay by congressional leaders and others, Mulkeen Decl. ¶ 24; (2) deliberative discussions of media coverage and media engagement, id. ¶ 25; (3) deliberative discussions of issues related to interactions with the International Committee of the Red Cross, id. ¶ 26; (4) a point-by-point commentary on a letter from Senator Feinstein about hunger strikes and enteral feeding, id. ¶ 27; (5) General Kelly’s opinions on the usefulness of advisory documents pertaining to the enteral feeding program at Guantánamo Bay, which are provided to senior officials to help them inform their views of the documents, id. ¶ 28; see also Pls.’ Cross-Mot. for Summ. J., ECF No. 19, Ex. PP-1 to Langford Decl., ECF No. 19-5, at 18; (6) a deliberative discussion of a response to a congressional letter, Mulkeen Decl. ¶ 28; (7) General Kelly’s advice 30 and recommendations on an issue raised by a senior official, id.; and, finally, (8) General Kelly’s opinions about congressional oversight, id.; see also McCubbin Decl. ¶¶ 57–61. With the exception of Record 199, the court finds that DOD has satisfied the foreseeable harm standard as to these records. In his declaration, Deputy Mulkeen details how the release of each of these sub-categories of information is likely to cause harm to the agency’s deliberative processes. For instance, regarding the visits to Guantánamo Bay, Deputy Mulkeen explains that the “potential for public scrutiny and disclosure of th[e]se discussions” would reasonably be expected to “discourage[] senior officials like the Commander of SOUTHCOM from frankly discussing issues related to those visits,” thereby harming “the agency’s ability to engage in fully informed discussion[s]” of these issues going forward. Mulkeen Decl. ¶ 24. Deputy Mulkeen provides similar levels of detail with respect to each of these categories. Plaintiffs repeat the same objections to these categories, and the court rejects them for the reasons already discussed. Accordingly, the court finds that DOD has met its burden as to these records. DOD has not carried its burden as to Record 199, however. The agency’s declarations simply provide too little detail on the information withheld in this record, stating only that “Record 199 contains General Kelly’s opinion on an issue raised by a senior official,” McCubbin Decl. ¶ 61; see also Mulkeen Decl. ¶ 28 (same). Deputy Mulkeen asserts that “[t]he Commander of SOUTHCOM must be free to convey his frank and unguarded opinion when responding to issues presented by senior officials in order to ensure that those senior officials have the appropriate information and advice when making decisions about JTF-GTMO,” Mulkeen Decl., ¶ 28, but he never asserts that release of the information contained in Record 199 is likely to chill these sorts of communications or otherwise harm the agency’s decisionmaking process. Because DOD has provided too little information as to the subject matter of the information withheld from Record 31 199 and has failed to connect “in a meaningful way” the harm stemming from its release to the information withheld, Ctr. for Investigative Reporting, 2019 WL 7372663 , at *9, the court grants Plaintiffs’ motion as to this information. C. Segregability Finally, the court considers the segregability of the remaining information DOD properly withheld pursuant to Exemptions 1 and 5. See Sussman, 494 F.3d at 1116 (stating that the district court must consider the segregability of the information withheld “even if the requester did not raise the issue of segregability before the court”). Plaintiffs have not identified any reason to doubt DOD’s statement that it has the reviewed the withheld records “line-by-line to identify information exempt from disclosure for which a discretionary waiver of exemption could be applied,” making “[e]very effort” to “segregate releasable material from exempt material,” McCubbin Decl. ¶¶ 78– 79; nor has the court’s in camera review identified any reason to question DOD’s attestation. Accordingly, the court is satisfied that the agency has complied with its segregability responsibility as to this information. See Sussman, 494 F.3d at 1117 (noting that agencies are “are entitled to a presumption that they complied with the obligation to disclose reasonably segregable material”). V. CONCLUSION AND ORDER For the reasons set forth above, the court grants in part and denies in part Defendant’s Motion for Summary Judgment, ECF No. 31, and grants in part and denies in part Plaintiffs’ Motion for Summary Judgment and Partial Reconsideration, ECF No. 34. 1. As to the information pertaining to congressional matters in Records 272 and 304. Plaintiffs’ Motion for Summary Judgment is granted as conceded, with the exception of the detainee movement order number. 32  2. As to the foreign government information in Record 273, DOD’s Motion for Summary Judgment is granted as conceded. 3. As to DOD’s withholding under FOIA Exemption 1 and EO 13,526 § 1.4(a), Plaintiffs’ Motion for Summary Judgment and Partial Reconsideration is granted as to the officially acknowledged tallies of hunger strikers and force-fed detainees at Guantánamo Bay between March 19, 2013, and December 2, 2013. Defendant’s Motion is granted as to the information relating to the reaction of the detainees upon learning of their transfer, which is inextricably intertwined with otherwise classified information. 4. Defendant’s Motion is granted as to all other withholdings under FOIA Exemption 1 and EO 13,526 § 1.4(c). 5. As to Exemption 5, Defendant’s Motion is granted as to all categories of information except the Facilities Management category and Record 199. Plaintiffs’ Motion is granted as to these categories of information. The parties are directed to meet and confer and file a Joint Status Report by March 12, 2020, which updates the court on whether any further litigation is required on records not provided as samples for the court’s in camera review, and, if so, proposes a schedule for further proceedings in this matter. Dated: March 5, 2020 Amit P. Mehta United States District Court Judge 33

2020-03-06 00:02:27.305525+00

http://www.courts.ca.gov/opinions/documents/B292418.PDF

Filed 3/5/20 CERTIFIED FOR PUBLICATION IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA SECOND APPELLATE DISTRICT DIVISION EIGHT QINGYU ZHANG, B292418 Plaintiff and Appellant, (Los Angeles County Super. Ct. No. EC068282) v. ANTHONY CHU, Defendant and Respondent. APPEAL from a judgment of the Superior Court of Los Angeles County, William D. Stewart, Judge. Affirmed. Liu Law and Long Z. Liu for Plaintiff and Appellant. Law Offices of Dilip Vithlani and Dilip Vithlani for Defendant and Respondent. ____________________  In this malicious prosecution suit, the plaintiff lacked evidence showing the defendant acted with malice. The trial court thus rightly granted the defendant’s special motion to strike the plaintiff’s meritless suit. We affirm. I We begin with a brief factual overview. Mr. Anthony Chu is the defendant lawyer in this malicious prosecution case. Mr. Qingyu Zhang sued lawyer Chu because Chu had added Zhang as a defendant in an earlier and underlying lawsuit. Chu dismissed Zhang from that underlying case without prejudice, which prompted Zhang to sue Chu for malicious prosecution, which prompted Chu to file a special motion to strike Zhang’s malicious prosecution case, which the trial court granted. The trial court struck Zhang’s malicious prosecution case for want of malice. Malice is a vital element of malicious prosecution, and Zhang had no proof of it. In every malicious prosecution case, there is an earlier and underlying case. We next explain that case, which has continued in parallel with this other one. The underlying case was Qi v. Bluestar Express Group Inc. (Super. Ct. L.A. County, 2019, No. KC068561) (Qi v. Bluestar), which is a wage-and-hour case against a trucking company called Bluestar Express Group, Inc. Lawyer Chu represented a worker named Jiang Qi. On behalf of Qi, Chu filed the action alleging Bluestar had worked Qi 24 hours a day and seven days a week at a trucking warehouse. Bluestar allegedly required Qi to work whenever a truck came in and paid no overtime, gave him improper breaks, and otherwise violated the Labor Code. In addition to Bluestar, Chu’s original complaint for Qi named Ms. Yidan Zhang (no relation to appellant Qingyu Zhang) 2 as an individual defendant, together with 20 Doe defendants. The date of Chu’s original complaint was June 29, 2016. According to the complaint, Bluestar’s address is 719 S. Nogales Street, City of Industry, CA 91748. Qi’s complaint alleged Bluestar was a sham corporation, claiming it had been set up with illusory capital to evade potential judgment creditors like Qi, should he win a judgment against Bluestar. As this allegation suggested, Qi and Chu had suspicions about the extent of Bluestar’s corporate integrity and independence. Qi later declared others worked at the 719 Nogales Street address, but those other employees and Qi did not all have the same employer. The businesses there shared employees and pooled their resources. It appeared to Qi another company called New Diamond Trucking, Inc. (New Diamond) was combining its business efforts with Bluestar at that same address, sometimes as though it was one business. Chu later declared he discovered New Diamond trucking company operates at that same 719 Nogales Street address. The record shows many connections between Bluestar, New Diamond, and Qingyu Zhang. Chu learned Qingyu Zhang was the sole shareholder of New Diamond. Chu found the California Secretary of State listed Qingyu Zhang as chief executive officer and as a director of New Diamond, which listed its business and executive offices as 719 Nogales Street, City of Industry, CA 91748. Zhang admits he is owner, CEO, and director of New Diamond. 3  Qingyu Zhang’s son, Tom (also known as “Tao”) Zhang, is the agent for service of process for New Diamond. New Diamond made $40,000 and $50,000 payments to Bluestar. Chu testified the trial court sanctioned Bluestar $5,420 for discovery violations, but Bluestar paid Chu this sum with a check from New Diamond. The check is signed in what appear to be non-English characters. The signature appeared to Chu to be that of Qingyu Zhang. There were other instances in which Chu concluded one person was signing checks for both Bluestar and New Diamond. Chu’s online investigation revealed a pattern. It appeared a group of individuals, including Qingyu Zhang and his son Tom Zhang, operated a single enterprise by forming and then dissolving several different companies. Two of the dissolved companies were “Sunlight Logistics” and “Sunlight Logistics Group.” Both also had operated at the same 719 Nogales Street address. The same person had signed documents for all these companies. On September 14, 2017, Chu used Doe substitutions to add Qingyu Zhang and others to Qi v. Bluestar on alter ego and single enterprise theories. When Zhang entered the case, he retained the same law firm as the one representing Bluestar. On January 3, 2018, Zhang filed a motion under section 128.7 of the Code of Civil Procedure challenging Chu’s decision to add Zhang to Qi’s case. Chu declared that, rather than undertake the cost and risk of opposing Zhang’s section 128.7 motion, Chu dismissed Zhang without prejudice on January 22, 2018, during the section 128.7 safe harbor period. 4  On January 19, 2018, Chu amended Qi’s complaint to add New Diamond as a defendant. Zhang sued Chu for malicious prosecution on March 21, 2018. Chu filed a special motion to strike Zhang’s action on May 29, 2018. The trial court issued a 15-page tentative ruling and heard argument on June 22, 2018. The court ordered further briefing, issued an amended 22-page tentative ruling, and held a second hearing on July 27, 2018. The trial court granted Chu’s special motion to strike. Zhang appeals that order. Meanwhile, the underlying case of Qi v. Bluestar has continued forward in the trial court. II The trial court properly granted Chu’s special motion to strike. Zhang lacked proof he probably would succeed in proving Chu acted with malice. No malice meant no malicious prosecution, which meant defeat for Zhang. A Three bodies of law are germane. First, we summarize law governing special motions to strike. Second, we survey the tort of malicious prosecution. Third, we touch upon sham corporations and alter egos. 1 The special motion to strike procedure is a recent creature of statute. The California Legislature passed this act in 1992. (Code Civ. Proc., § 425.16.) A special motion to strike involves two steps. The first step is not relevant here because all sides agree Chu’s motion satisfied it. The second step is our sole focus. 5  The second step in a special motion to strike is a summary- judgment-like procedure to determine whether plaintiff Zhang “established that there is a probability that [Zhang] will prevail on the claim.” (Code Civ. Proc., § 425.16, subd. (b)(1), italics added.) We independently review trial court rulings on special motions to strike. (Monster Energy Co. v. Schechter (2019) 7 Cal.5th 781, 788.) 2 We turn to the tort of malicious prosecution. Unlike the special motion to strike, which springs from a modern California statute, the roots of the common law tort of malicious prosecution go deep into the past. (E.g., Groundless Litigation and the Malicious Prosecution Debate: A Historical Analysis (1979) 88 Yale L.J. 1218, fn.1 [citing Code of Hammurabi, Babylonia, 2250 B.C.].) We sketch this tort’s modern dimensions. There are three elements to malicious prosecution. The plaintiff, who was the defendant in the underlying action, must prove (1) the defendant was responsible for the underlying lawsuit, which ended in a legal termination favorable to the plaintiff; (2) the defendant brought the underlying lawsuit without probable cause; and (3) the defendant brought the underlying lawsuit with malice. (Soukup v. Law Offices of Herbert Hafif (2006) 39 Cal. 4th 260 , 292.) We can nickname these three elements as favorable termination, probable cause, and malice. All three elements are essential. The trial court ruled Zhang failed to establish the third element of malice, so we focus on that ruling. We do not address the other elements. 6  The malice element of malicious prosecution has an elaborated common law meaning. Malice may refer simply to subjective hostility or ill will, but it also has rather different meanings as well. We explore this complex legal concept. Justice Roger Traynor on behalf of a unanimous Supreme Court quoted and adopted the Restatement’s definition of malice in 1956. We italicize the vital portions of this classic and governing definition: “The malice required in an action for malicious prosecution is not limited to actual hostility or ill will toward plaintiff but exists when the proceedings are instituted primarily for an improper purpose. . . . It has been pointed out that the ‘principal situations in which the civil proceedings are initiated for an improper purpose are those in which (1) the person initiating them does not believe that his claim may be held valid; (2) the proceedings are begun primarily because of hostility or ill will; (3) the proceedings are initiated solely for the purpose of depriving the person against whom they are initiated of a beneficial use of his property; (4) the proceedings are initiated for the purpose of forcing a settlement which has no relation to the merits of the claim.’ ” (Albertson v. Raboff (1956) 46 Cal. 2d 375 , 383, italics added, quoting Rest., Torts, § 676, com. b.) This fourth definition of malice is the pertinent one here. This case does not involve evidence about the first three: (1) about Chu’s lack of belief that Qi’s claim would not be held valid, (2) about Chu’s personal hostility or ill will toward Zhang, or (3) about depriving a person of a beneficial use of property. We thus concentrate on the fourth definition. 7  The fourth definition of malice requires plaintiffs to prove the defendant initiated proceedings to force a settlement that has no relation to the merits of the claim. An alternative and equivalent phrasing is that the defendant initiated the lawsuit “primarily for a purpose other than that of securing the adjudication of the claim on which the proceedings are based.” (Rest., Torts, § 674, subd. (a)(ii).) As adapted to this suit’s procedural posture, then, Chu’s motion required Zhang to offer evidence Chu initiated proceedings against Zhang to force a settlement having no relation to the merits of Qi’s wage-and-hour claim. Supreme Court law specifies that the malice element relates to the subjective intent or purpose with which Chu brought Zhang into the case. (Sheldon Appel Co. v. Albert & Oliker (1989) 47 Cal. 3d 863 , 874 (Sheldon).) 3 A third body of law concerns sham corporations and “piercing the veil.” Courts may disregard the corporate entity when the corporation is merely the alter ego of its stockholders. Called piercing the corporate veil, this equitable doctrine gives creditors access to the stockholders’ personal assets when the corporation’s assets are so minimal that their small size would defeat a plaintiff’s judgment against the corporation, thus creating an inequitable result. (See, e.g., Haning et al., Cal. Practice Guide: Personal Injury (The Rutter Group 2019) §§ 2:2016 to 2:2024, pp. 2(II)-297 to 2(II)-299.) A variety of factors informs this equitable analysis about when to pierce the veil. These factors include the following: 8  ● whether ownership of the corporation’s stock is concentrated in one individual or family, ● whether there is use of the same office or business location, ● whether there is employment of the same employees, and ● whether there is employment of the same attorney. (Associated Vendors, Inc. v. Oakland Meat Co. (1962) 210 Cal. App. 2d 825 , 839.) B We apply this law to the facts of this case. To briefly recap, it is the fourth definition of the third element of malice that is our focus. The procedural posture and this definition of malice imposed a burden on Zhang to offer evidence showing his probability of success in proving Chu sued him for a reason having no relation to the merits of Qi’s wage-and- hour claim. As a matter of law and logic, the “no relation to the merits” element meant it would not be enough for Zhang to show Chu added Zhang to the wage-and-hour case simply to “force a settlement.” Forcing a settlement is the omnipresent and proper goal of litigation. One litigator is constantly trying to convince the other to settle on the one litigator’s terms, on pain of eventual and costly defeat. Parties turn to the force of litigation when less coercive settlement efforts have failed. Attempts to force settlements thus are common. To make a litigation motive improper, to make it “malicious,” it takes more than a simple desire to win. The attempt to force a settlement must be unrelated to the merits. 9  The “unrelated to the merits” element meant Zhang had to show Chu added Zhang to the case for a reason unrelated to the merits of the wage-and-hour case. By requiring Zhang to prove Chu’s reason was not related to the merits, this definition required Zhang to prove a negative: that Chu’s reason for adding Zhang was not related to the merits of the case. Proving a negative is hard, and intentionally so for this tort, which is disfavored. (See Sheldon, supra , 47 Cal.3d at pp. 872–874 [malicious prosecution is a disfavored tort because it tries to solve the problem of excessive litigation with more litigation, and so it is advisable to retain traditional limitations on the tort].) Determining whether reasons are unrelated to the merits requires familiarity with the merits. In wage-and-hour cases, searching for alter egos can be, and typically is, on the merits. Plaintiffs must worry about this issue at the outset of their case. A common reason for adding individuals as defendants to wage-and-hour litigation is plaintiffs’ fear of procuring a worthless judgment. A judgment is worthless if it is against an entity that is merely an empty corporate shell. This is not a problem when the defendant is a Fortune 500 corporation and a plaintiff has confidence the corporate entity has substantial assets. But wage-and-hour cases sometimes are against employers of small size or of unknown substance. If a named defendant entity indeed is merely a shell, the supposedly victorious plaintiff can be left with few or no assets against which to levy. The plaintiff’s hard-won judgment then is worthless as a practical matter. From the plaintiff’s perspective, the litigation would have been in vain. For this reason, it is common in wage-and-hour litigation for plaintiffs to 10 search for people they suspect may be alter egos of corporate shells. Zhang thus had to establish this reason was not the subjective purpose Chu had for adding Zhang as a Doe defendant. That reason -- searching for prospective alter egos -- would have been properly related to the merits of this litigation. Zhang had to disprove it. Zhang failed in this quest. The trial court ruled none of his evidence established Chu acted with malice. Zhang attacks the trial court ruling with a scattershot of 10 invalid arguments. His points are numerous and insubstantial. We treat them in turn. First, Zhang argues the trial court erred in requiring him to prove a “probability” of succeeding on the malice element. Zhang claims the court elevated the legal standard in a way that “was unexplained and unwarranted.” Zhang’s argument ignores the statute, which specifies Zhang must establish “a probability that [Zhang] will prevail on the claim.” (Code Civ. Proc., § 425.16, subd. (b)(1), italics added.) The trial court properly applied the letter of the statute. Second, Zhang argues Chu added Zhang and five others as Doe substitutions “in a single day without any change to the original complaint.” The fact Chu added Does, however, does not show why Chu added Does. Zhang asserts in passing that Chu “had been fully aware” of these Does’ “absolute lack of connections to the underlying employment lawsuit.” Zhang offers no citation to support this factual assertion, which we disregard. Third, Zhang argued to the trial court that Chu’s pattern of settlement demands showed Chu added Zhang to the case for a 11 reason unrelated to the merits. The pattern of settlement demands was as follows: 1. March 15, 2016 -- Chu made a prelitigation demand of $347,011.04. 2. June 29, 2016 -- Chu filed the Qi action. 3. July 24, 2017 -- Chu made a settlement offer of $500,000. Chu explained he calculated this case valuation by adding the sums Qi was due for overtime, failure to pay minimum wage, failure to provide breaks, pay stub violations, waiting time penalties, and attorneys fees. 4. September 14, 2017 -- Chu added Zhang to the Qi action via a Doe substitution. 5. October 18, 2017 -- Chu made a settlement offer of $150,000 that would expire upon the filing of answers by the Doe defendants. The pattern of Chu’s settlement demands thus was $347,011.04, then $500,000, then $150,000. This pattern of demands logically shows nothing about Chu’s reason for adding Zhang to the lawsuit. Zhang’s insistence this pattern shows improper extortion is invalid. Chu’s demands may have been accurate reflections of his evolving analyses of the case’s value, or tactical bluffing, or alternating moods of optimism and panic, or a combination of all the above, or something else entirely. The pattern of demands is not evidence of Chu’s subjective reason for adding Zhang to the case. Fourth, Chu specified his settlement offer would expire when and if Zhang answered. Nothing about Chu’s deadline shows malice. For a host of reasons, negotiators routinely put conditions on settlement offers. Nothing about this tactic shows 12 Chu’s subjective mental state when he added Zhang to the case. The inference Zhang urges is free of logical content. Fifth, Zhang argues Chu added New Diamond after adding Zhang, but Chu should have sued New Diamond before suing Zhang if Chu truly believed the alter ego theory. Zhang claims “[t]his unorthodox sequence of suing under [the] alter ego theory can hardly be anything but [an] aim to force a settlement from [Zhang’s son] Tom Zhang.” This argument is difficult to follow. The premise is one we do not accept: there is some accepted orthodoxy about the proper sequence of adding corporate and individual defendants. Zhang cites no authority for his claim Chu’s decisionmaking was “unorthodox.” Sixth, Zhang argues Chu dismissed Zhang without prejudice after Zhang filed his sanctions motion under section 128.7 of the Code of Civil Procedure. This argument founders on the fact the simple explanation for Chu’s dismissal is that Zhang’s motion cowed Chu. Seventh, Zhang argues Chu sued him for an improper purpose because Chu did not perform enough research before adding Zhang to Qi’s case. Zhang, however, cites no evidence that Chu’s research was substandard. These pages of Chu’s opening brief contain no record citations. In the course of this argument, Zhang admits he owns New Diamond, but he asserts New Diamond is “totally unrelated” to Bluestar. Zhang does not support this factual assertion with record citations. Eighth, Zhang notes the trial court initially mistook Yidan Zhang as Qingyu Zhang’s son. The court then held a further hearing at which all agreed that Tom Zhang, not Yidan Zhang, is Qingyu Zhang’s son, and that Yidan Zhang is a woman unrelated 13 to Qingyu Zhang. The court’s final ruling reflected this correction. This temporary mix-up was not evidence of Chu’s malice. Ninth, Zhang argues the trial court’s finding on element one -- no probable cause -- should satisfy element three: malice. This argument is legally invalid. The two elements are distinct. (Downey Venture v. LMI Ins. Co. (1998) 66 Cal. App. 4th 478 , 493– 499.) Tenth, Zhang argues the trial court’s reliance upon Daniels v. Robbins (2010) 182 Cal. App. 4th 204 was misplaced. The trial court cited Daniels as authority it could decide whether there was any triable issue on malice as a matter of law. (See id. at p. 227.) Zhang does not dispute Daniels is good law. He merely asserts he has a stronger case than the plaintiffs in Daniels and he deserves a jury trial. This argument fails because Zhang lacks evidence of malice. In sum, Zhang offered no evidence he had a probability of success on his malicious prosecution claim. The trial court was right to grant Chu’s special motion to strike Zhang’s meritless suit. We need not and do not reach Chu’s other arguments about whether Chu’s case against Zhang had been terminated in Zhang’s favor or whether Chu lacked probable cause to sue Zhang. 14  DISPOSITION We affirm the judgment and award costs to Chu. WILEY, J. We concur: GRIMES, Acting P. J. STRATTON, J. 15

2020-01-17 22:01:45.505516+00

Green

*723OPINION. GREen: The first question raised in this proceeding is whether certain income from a trust fund, received by the petitioner’s wife pursuant to a formal and complete assignment by him to her of his right or interest, is nevertheless taxable to the petitioner. The right of the petitioner in the trust was clearly and definitely established and determined by the courts of the State of Illinois, and as to property rights, its decree is unquestionably binding on this Board. From this decree it is apparent that as to the two-fifths trust, the petitioner’s right or interest is adjudged to be unqualified to the extent that he is not only entitled to all the income but is so entitled thereto with all the incidents of absolute ownership. By virtue of these provisions in the decree the right or interest in question is as freely assignable as any beneficial right or interest under a testamentary trust ever can be. That the petitioner’s vested estate in the two-fifths trust was assignable under the applicable law, namely, that of the State of Illinois, is not questioned. Consideration is not necessary to support and render perfect and irrevocable an executed assignment of a vested equitable right or interest such as the petitioner’s interest in the two-fifths trust. Edith H. Blaney, 13 B. T. A. 1315. The petitioner by such assignment completely divested himself of any interest in the right to receive such income and it follows that he may not be taxed therefor. The second question is whether a sum paid counsel, pursuant to a contingent-fee contract, for obtaining for the petitioner a decree resulting in income which otherwise he could not have received is a capital expenditure or a business expense. The construction of the will of the late Marshall Field was brought about by litigation instituted by the petitioner. The court in its decree held that upon the death of Henry Field the petitioner succeeded to his brother’s interest in the two-fifths trust, free from all provisions as to accumulations of income. The decree, being one of construction, added nothing to the petitioner’s rights, which it merely declared. The effect of the decree was to give the entire income of the two-fifths trust to the petitioner, whereas, but for the decree, the trustees would have received none of it until he arrived at the age of 30 years, but one-sixth of it between the ages of 30 and 35, but one-third of it between the ages of 35 and 40, and but one-half of it between the ages of 40 and 45. The income so retained by the trustees under *724the terms of the trust instrument, that is, the whole for a time, then for 5 years five-sixths, then during successive 5-year periods, two-thirds and a half, would, but for the decree, have been added to principal and have been treated as capital, so that none of it would have been income received by the petitioner. The provision of the decree that the income from Henry Field’s two-fifths share should be distributed currently to the petitioner was directly attributable to the endeavors of Stanchfield and his associates, who represented the petitioner in the proceeding. The circumstances in regard to the making of the contingent-fee agreement and the subsequent settlement of the disputed claim for professional services have been set up at length in the findings of fact. The applicable statutes are sections 212, 213, and 214 of the Revenue Act of 1921. Section 212 (a) reads as follows: That in the case of an individual the term “ net income ” means the gross income as defined in section 213, less the deductions allowed by section 214. Sec. 213. That for the purposes of this title (except as otherwise provided in section 233) the term “gross income”— (a) Includes gains, profits, and income derived from salaries, wages, or compensation for personal service * * s of whatever kind and in whatever form paid, or from professions, vocations, trades, businesses, commerce, or sales, or dealings in property, whether real or personal, growing out of the ownership or use of or interest in such property; also from interest, rent, dividends, securities, or the transaction of any business carried on for gain or profit, or gains or profits and income derived from any source whatsoever. The amount of all such items (except as provided in subdivision (e) of section 201) shall be included in the gross income for the taxable year-in which received by the taxpayer, * * * and section 214: (a) That in computing net income there shall be allowed as deductions: (1) All the ordinary and necessary expenses paid or incurred during the taxable year in carrying on any trade or business, * * * In George P. and Bessie P. Douglas, 1 B. T. A. 372, we held that “ legal expenses incurred in breaking a will by which a taxpayer comes into possession of his inheritance are not expenses incurred in carrying on a trade or business.” In Lena G. Bill, 8 B. T. A. 1159, we said, “ the attorney’s fee of $1,000 was paid, not in connection with the defending, protecting or establishing the petitioner’s title or right to the possession of property, but in connection with the litigation to establish the petitioner’s legal liability to pay the debts for material incurred by the contractor. We think that this amount, as well as the $500 attorney’s fee paid in 1923 in connection with other matters, constitutes ordinary and necessary business expense.” ■ *725In Frederick McLean Bugher et al., Executors, 9 B. T. A. 1155, there was presented the question as to whether attorney’s fees paid were capital expenditures or business expenses. We said: It is our opinion that to the extent that such payments relate to the right of taxpayers to retain the income or to enlarge their share of the income of the mine, they are deductible; while to the extent that they represent expenditures made to acquire London’s interest in the mine or enlarge their own interests as against the McLean estate, or to defend their title to the mine, such payments are in the nature of capital expenditures to be added to the other costs of the property and recovered as are such other costs. In First National Bank of St. Louis, 3 B. T. A. 807, in holding that the attorney’s fees, etc., paid in connection with the consolidation of the bank, were capital expenditures, we said: “ The transaction which called forth the expenditures here in question was presumably one which increased and maintained the earning power of the taxpayer and thus throughout its corporate life the taxpayer will enjoy the fruits of these expenditures.” In Emerson Electric Manufacturing Co., 3 B. T. A. 932, we held that fees paid for legal services in connection with the taxpayer’s negotiations with brokers and in the amendment of its charter authorizing the sale of its stock, were capital expenditures. In Columbia Theatre Co., 3 B. T. A. 622, we held that attorney’s fees paid in connection with the acquisition of leases were capital expenditures. In Gilbert Butler et al., 4 B. T. A. 756, the heirs of a certain estate, which had among its assets a coal mine under lease, became dissatisfied with the lessee’s performance and employed engineers and attorneys to collect data and institute suit for the cancellation of the lease. We held, “ The payment made to engineers and others by the corporation for and on behalf of the lessors was a capital expenditure and the value of the securities so paid has been added to the March 1,1913, value in the determination of gain or loss.” In William Ziegler, Jr., 1 B. T. A. 186, the facts were that the petitioner was the sole beneficiary of a trust and was desirous of having himself appointed as successor to the then trustees. This he desired for two reasons. First, he was dissatisfied with the management of the estate and wished to control it himself, and, second, to avoid the payment of compensation to the trustees to the end that the moneys which would be paid to them if they continued in office, would ultimately come to him. An arrangement was effected whereby the petitioner paid the trustees $200,000 in consideration of which they relinquished their positions and he became the sole trustee. In holding that the amount paid was a capital expenditure rather than a business expense, we said, “ The elimination of the other trustees and *726the qualifying of the taxpayer as trustee did not vest in him a full ownership of the property, but merely put him in sole control under the instrument creating the trust and the laws governing trust estates. He was not, in effect, buying an estate which forthwith would become his property and the purchase price of which he could not take into consideration in computing his income until he should dispose of the property acquired, but he was rather bujdng the right to be sole trustee without interference over a period of 12 years. We think the Commissioner was wrong in not allowing any deduction, and that the taxpayer was wrong in claiming in one year deduction of the entire amount paid. The taxpayer should be regarded as having for the purpose of insuring his interest in the estate against waste, purchased a right to do certain things for a period of time and the cost to him of that right should be spread over the period of time- during which he was in a position to exercise it.” Expenditures of the kind herein involved are not usual and their classification is not easy. Tested in the light of the above-cited cases, excerpts from the opinions of which we have quoted, we are of the opinion that the amounts paid Stanchfield and his associates are in the nature of capital expenditures and that they may not properly be classified as ordinary and necessary business expenses. The right which the petitioner acquired through the expenditure is an exhausting or wasting right and the petitioner is accordingly entitled to have reasonable allowances to the end that his capital expenditures be returned to him. In determining how this allowance should be made, we are confronted with the practical difficulty of determining the life of the right acquired as the result of the expenditure to the end that the amount of an annual allowance be determined. Since the petitioner’s income at some time should be reduced by the amount of the payments, it would seem that the petitioner’s income will be most accurately reflected by allowing a deduction from income each year of the amount paid. Accordingly, the amount of the attorney’s fee paid in the year under consideration, should be deducted before reporting the amount received as income. Reviewed by the Board. Judgment will he entered under Rule 50. Siefkin dissents.

2020-01-17 22:01:45.547907+00

Trussell

*731OPINION. TRUssell: The deficiency notice dated July 27, 1925, and which is made a part of the petition filed, asserts deficiencies for the three calendar years 1918, 1919, and 1920, against the “ Robert Brunton Studios, Inc., 5341 Melrose Ave., Los Angeles, Calif.” *732There are two issues presented for decision in this appeal — (a) what amounts, if any, may be included in petitioner’s invested capital for the taxable years involved as representing assets stated to consist of an option to purchase certain tangible assets, together with an equity in such assets represented by payments made under the option, the good will of an individual business and three contracts, all of this property having been acquired for stock, and (b) whether or not a deduction from gross income is allowable on account of exhaustion of such assets. A decision on the first issue requires little discussion. Much testimony has been introduced with respect to the value of the assets in question but value in this instance is not the basis for computation of invested capital, as the acquisition of these assets was from an individual for stock issued in an amount in excess of 50 per cent of the total authorized capital stock of the corporation, and section S31 of the Revenue Act of 1918 applies, limiting the amount to be included in invested capital on account of the assets to their cost to the previous owner from whom acquired. The record shows no cost to Robert Brunton of the assets in question, other than payments totaling $41,062.70 made by him on the purchase price of the propertj? covered by the option to purchase. No question is raised as to the action taken by respondent in respect to the equity in this property represented by the sum of these payments, its full cost having been allowed by him. This asset is the only one of the several acquired for the stock in question which shows a cost to the previous owner and respondent’s determination of invested capital is approved. The second issue presents a different question, as the values of assets, allowable for purpose of computation of deductions from income oil account of exhaustion, under section 234 (a) (7) of the Revenue Act of 1918, are not subject to the limitations imposed by section 331 of that Act. Strong, Hewat & Co., 3 B. T. A. 1035; Kennedy Construction Co., 4 B. T. A. 276. Let us consider the assets separately. A total of 149,993 shares of stock of a par value of $149,993 was issued for four assets, one of these being an equity in property of $41,062.70, representing cash payments already made on account of the purchase price. To this asset the corporation allotted a book value of $41,062.70. To the remaining three assets the corporation allotted the balance of the stock issue at par in the sum of $108,930.30, divided as follows: Good will-$50, 000. 00 Contracts_ 23, 930. 30 Option to purchase_ 35, 000. 00 108, 930.30 *733If these values are provable as of the date of acquisition and the assets are depreciable in character, petitioner is entitled to deduction of a reasonable allowance for exhaustion. Strong, Hewat & Co., supra; Troxel Mfg. Co., 1 B. T. A. 653; East Market Street Hotel Co., 11 B. T. A. 796. Petitioner’s insistence is that the asset described as good will and which was acquired for 50,000 shares of stock issued was not the good will of the old business of Robert Brunton Co. but was a contract made by Robert Brunton to give his entire service to the corporation" for a period of two years, with option given the latter for two years additional, and that the limitation of $60,000 per year placed on the aggregate salaries of all officers of the corporation by that agreement gave the corporation his services at a figure greatly below what he might expect to receive from other companies. It is insisted that although this item is designated as good will it really represents a contract for service to be rendered which had a great value above the salary to be paid and that the period of that service was in fact three years and this gave a basis upon which its value may be depreciated. We are satisfied from the record that Brunton was a man of great ability and experience in his profession, with a fine reputation, personal influence and good will. There is no doubt that his services were of great value to the corporation, probably in excess of the salary he drew. However, all other questions aside, the record shows clearly that this contract for services, which petitioner insists constituted the value of the item of good will and was the basis of its estimate of $50,000 ascribed to that value, was not acquired for the issue of stock in question. Brunton was in no way obligated to render service to the corporation as a consideration of the stock received. The contract for his services was executed on October 4, 1918, more than a month after the sale and transfer to the corporation of the assets in question for 149,993 shares of stock, and is shown to have been entered into as one of the considerations for the purchase of 50,000 shares of treasury stock at par by two wealthy investors, Hutton and Danzinger. Brunton was the holder of three-fifths of the corporate stock and it was essential to obtain cash capital and desirable to interest wealthy investors who would give financial strength to the corporation. Hutton and Danzinger were of this character, but, as a condition of their investment, they required of Brunton a contract to serve the corporation for a definite term and a share of his stockholdings as a bonus. Petitioner only claims a value for the item of good will as a result of the contract for service, and this we find was not acquired for the stock issued, but was an asset acquired later without cost to the corporation, and *734any value which it might have is accordingly not the basis for a deduction for exhaustion. Automatic Fire Protection Co., 3 B. T. A. 1267; First State Bank, 5 B. T. A. 1176; Kennedy Construction Co., supra. Aside from this question, however, the record shows that the asset actually acquired for this issue of 50,000 shares of stock was not Brunton’s contract of service but the good will of the old business known as “ Robert Brunton Company.” The contract detailing the transaction describes it in clear and unmistakable terms as¿ 6th. Generally the Good Will of Business of the business of said Robert Brunton heretofore conducted under the name and style of Robert Brunton Company in the manufacture and production of said motion pictures. The proof also gives a picture of the motion picture industry, and this business in particular, which shows that good will existed and had a very definite value. In fact we have no doubt that its value was equal to the par value of the 50,000 shares of stock issued therefor, but such conclusion does not make a loss in value of that asset due to the death of Robert Brunton the subject of a deduction under section 234 (a) (7) of the Revenue Act of 1918 in arriving at net income. The three contracts for production of motion pictures which Brun-ton assigned the corporation as one of the considerations for the issue of 149,993 shares of stock and to which the latter allocated $23,-930.30 par value of the stock issued, and which value it now seeks to prove and to be allowed to depreciate, are shown to our satisfaction to have had an intrinsic value. Moreover, the action of the officers of the corporation in the exercise of their best judgment in placing a value of $23,930.30 on these contracts when acquired, although not sufficient in itself, in this instance, to carry the burden of proof of such value, is evidence of actual value. Aluminum Flake Co., 6 B. T. A. 1193. These contracts provided in the case of the Bathe Company for two pictures at $15,000 each, with a conditional bonus in each case of $3,000. The other contracts provided for rental of the studio to the producing companies for $500 per week and properties at a percentage of their cost and for reimbursement of the corporation at cost plus 10 per cent profit for any additional labor and material expended by it. The use of the properties of the corporation under these latter contracts was not exclusive, the corporation reserving the right to contract with other companies for their use concurrently and to use them itself during this time in the production of motion pictures. Under these latter contracts there was no possibility of loss to the corporation. They meant an absolutely certain income, the amount of which was dependent upon the time to produce the *735pictures and the additional amount of scenery, sets, etc., which the corporation would be required to construct at the expense of the producer, and these conditions appear to us to be ones which could be calculated in advance with reasonable accuracy by the officers of the corporation. In other words, it appears to us that at the time when these officers placed a value of $23,930.30 on these contracts the facts were in their possession upon which men of the character and experience that the record shows them to be could have made a correct valuation. Certain of these officers testified at the hearing as to their valuation of the contracts and as to the reasonableness of that valuation in their opinion, both in the light of the facts then existing and now known after performance of the contracts. The net profit from these contracts is not shown, but it does appear in evidence that from the Pathe Company and Helen Keller Co. contracts, gross income of $24,095.52 and $57,000 was received during the balance of the calendar year 1918, and it is very apparent from the record that the operations of the corporation were profitable from its inception. We are of the opinion that petitioner has sustained sufficiently the burden of proof that the contracts in question had a reasonable value of $23,930.30. It appears that these contracts were performed in the calendar years 1918 and 1919, and the value assigned them is the basis for the deductions for exhaustion over those years, as made by petitioner. The remaining question pertains to the asset consisting of an option to purchase the properties of the Paralta Studios, Inc., acquired by the Arizona corporation from Brunton, and to which it ascribes a value of $35,000 on its books, balancing thereby a similar amount at par of (he total stock issued to Brunton and associates. In respect to this item (here is no proof as to a value for the property represented by the option to purchase held by the Paralta Studios, Inc., on the real property which it leased, which option was included in the assets covered by the option to purchase given Brunton by that company, but there is ample proof that the studio facilities and equipment had a value in excess of the $35,000 plus the option price of $125,000. This property is shown to have cost the Paralta Studios, Inc., a sum very largely in excess of $125,000 and the payment of that price under the option secured it clear of indebtedness. Its value was placed by witnesses in the neighborhood of $200,000. We conclude that the option to purchase had a reasonable cash value of $35,000 when acquired by Brunton from the Paralta Studio’s, Inc., under the proof showing that the property covered by it was worth that sum in excess of the option price of $125,000 or $160,000. *736Robert Brunton, however, exercised the option and paid $41,062.70 on the purchase price and what the Robert Brunton Studios, Inc., acquired for the issuance of stock in the amounts of $35,000 and $41,062.70 to Brunton was the $160,000 property itself subject to an indebtedness thereon of $84,937.30 which the corporation thereafter paid oif. This total of $160,000 represents the cost of these studio facilities and equipment in cash and stock to the corporation and this total is subject to depreciation for the taxable years in question. There appears to be no issue as to rate of depreciation upon the property. The deficiencies will be redetermined in accordance with the foregoing findings of fact and opinion. Reviewed by the Board. Judgment will be entered pursuant to Bule 50. Sternhagen concurs in the result.

2020-01-17 22:01:45.61585+00

Marquette

*749OPINION. Marquette : The first question raised by the record herein is whether the petitioner, in computing its net income for the years 1919 and 1920, is entitled to deduct in each year the amount of $8,000 paid to C. C. Desmond as salary. The petitioner contends that the salary so paid was reasonable in amount, and constituted an ordinary and necessary business expense and is therefore deductible. This the respondent denies. In our opinion the salary paid to Desmond was neither reasonable in amount nor was it an ordinary and necessary business expense. During the years involved he was clearly physically incapacitated, and had also been adjudged mentally incompetent, although there is evidence that his mental condition had improved. He did not visit the petitioner’s place of business and his only services to the petitioner consisted of advice to his wife on how to run the business, and some occasional suggestions concerning the advertisements made by the petitioner. A “ necessary business expense,” as we understand it, is one which is fairly and properly connected with the sound conduct of a business. Furthermore, assuming for the moment, that in 1919 and 1920 Desmond had recovered from his mental disability, the salary paid to him seems entirely out of proportion to the services rendered, and does not constitute “ ordinary and necessary expense ” within the meaning of the statute. Botany Worsted Mills v. United States, 278 U. S. 282; 49 Sup. Ct. 129. *750The petitioner introduced evidence to show that Mrs. Desmond’s services were worth at least $15,000 per year, whereas she was paid a salary of only $8,000 per year. Conceding this to be true, it does not alter the situation. The fact that Mrs. Desmond accepted a salary which was lower than the value of her services does not render reasonable the salary paid to her husband. On this issue we approve the action of the respondent. The second question is whether the petitioner is entitled to deduct, in computing its net income for the years 1919 to 1921, inclusive, the amounts paid to Mrs. Desmond for the purpose of carrying on investigations of certain of the petitioner’s employees. The evidence shows that the amounts claimed were actually paid to Mrs. Desmond with the approval and consent of the board of directors, on her representation that she intended to use the money in investigation of certain employees, including buyers of the petitioner, and that the making of such investigations was a practice which the petitioner and Desmond had theretofore pursued. The evidence also shows that in past years the petitioner had suffered pecuniary losses due to the dishonesty of employees. There is no question but that the money was actually appropriated by the petitioner and paid to Mrs. Desmond for the purpose mentioned, and it seems under the circumstances, a necessary purpose, and the petitioner definitely parted with its money for that purpose. As to these items the petitioner’s contention is sustained. The third question relates' to certain alleged bonuses which the petitioner seeks to deduct in computing its net income for 1920 and 1922. In the petition herein it is alleged that at the end of the years 1920 and 1921 the petitioner gave its employees Christmas bonuses in the form of merchandise orders amounting to $972 and $1,074, respectively, which amounts represented additional compensation to the employees for services rendered. The respondent in his answer denies these allegations and the petitioner has produced no evidence to support them. On the record as to this point we must affirm the action of the respondent. The fourth question relates to the respondent’s action in increasing the petitioner’s closing inventories for 1920 and 1921, and thereby increasing the petitioner’s income for those years. In its returns for 1920 and 1921, petitioner reported inventories of $374,111.87 and $327,710.83, respectively, which were determined, in accordance with a practice adopted in 1916 under the retail inventory method. Respondent, acting upon the basis of his examining agent’s report, has increased the inventory of 1920 by $14,002.15 and that of 1921 by $56,100.11, resulting in an increase of $14,002.15 in the net income of 1920 and an increase of $42,097.96 in the net income *751of 1921. The respondent’s determination as to the inventories also was made under the retail inventory method. The formula used by the petitioner for determining its inventories is set out in the findings of fact by way of an illustration of its application in the determination of the inventory for July, 1916. It may be stated thus: (a) (Opening inventory+purchases, at retail prices) — mark-clowns=retail value of goods on hand at beginning and purchases during year. (b) Retail value of goods on hand at beginning and purchased during year— cost of goods on hand at beginning and purchased during year=net mark-up. (c) Net mark-upH-retail value of goods on hand at beginning and purchased during year=percentage of net mark-up. (d) (Sales+mark-downs) Xpercentage of net mark-up=cost of sales and mark-downs. (e) Cost of goods on hand at beginning and purchased during year — cost of sales and mark-downs=cost of goods in closing inventory. The respondent used the following formula: (a) (Opening inventory+purchases, at retail prices) — (opening inventory+ purchases, at cost) =mark-up. (b) Mark-up-K opening inventory+purchases, at retail prices) =percentage of mark-up.' (c) Closing inventory at retail priceX(100% — percentage of mark-up) =cost of goods in closing- inventory. Petitioner contends that the formula adopted in 1916 is a correct one for determining the value of inventories at cost, and that its inventories have been consistently determined by this formula in all subsequent years to 1924. It asks, therefore, that we set aside the respondent’s determinations, which it terms as arbitrary and unjust, in favor of its own, which it alleges were made in accordance with a consistent and correct inventory practice. The respondent eon-tends that the formula which the petitioner used to determine the inventories of 1920 and 1921 is not in accordance with the regulations, and he denies the correctness of that formula and of the inventory values determined by it. Kespondent also denies that petitioner has followed a consistent inventory practice, pointing out that in 1920 petitioner abandoned the practice of verifying the inventory values determined according to its formula, by a physical count of the goods in the inventory priced at cost. Taking up first the question as to whether the petitioner has followed a consistent inventory practice since 1916, we find that the petitioner’s contention in this respect is not supported by the evidence. It was not until 1920, one of the years under consideration, that the petitioner entirely adopted the retail inventory method for income-tax purposes. It is true that in 1916 petitioner instituted the practice of maintaining' a running book inventory determined according to the retail inventory method, but at the close of each *752year, to and including 1919, the book inventory was adjusted to bring it into conformity with a physical count of the goods on hand valued on the basis of actual cost. No such adjustment was made in 1920, so' that the inventory of that year was the first to have been determined under the retail inventory method. It is true also, that the inventories of 1920 and 1921 were computed by the same formula that petitioner had used in maintaining the running book inventory from 1916 to 1919, inclusive, but as has already been pointed out, the final determinations as to inventories from 1916 to 1919 were based upon actual cost of the goods on hand, whereas in 1920 and 1921 such determinations were made on the basis of the retail inventory method, and, as to the latter determinations, they certainly are not representative of cost. The underlying principle of the retail inventory method is the determination of the inventory value by applying the complement of the percentage of mark-up to the retail value of the inventory. The petitioner and the respondent have attempted by this method to determine the inventories of 1920 and 1921 on the basis of cost, though each by a different formula, and their results differ by the amounts in dispute. An analysis of the inventory data set out in the findings of fact, which is taken from petitioner’s books of account, discloses that there is something fundamentally wrong with the book inventories, for they represent a lesser percentage of the retail values of the inventories than that percentage which is the complement of the percentage of mark-up. According to the petitioner’s procedure for determining the percentage of mark-up, that percentage for all departments for 1920 is 29.50 and its complement is 70.50, but the book inventory for that year, $374,111.87, is only 64.71 per cent of the retail value of. the inventory, $578,105.16. For 1921 the percentage of mark-up for all departments, computed according to the petitioner’s procedure, is 82.47 and its complement is 67.53, but the book inventory of $327,-710.83 is only 55.95 per cent of the retail value of the inventory, $585,704.79. Examination of the formula by which petitioner determined the book inventories, readily discloses the error accountable for these discrepancies. Under this formula the cost value of the inventory is determined by deducting the cost of sales from the total cost of opening inventory and purchases. The error is in computing the cost of sales, which is done by applying to the sales figure, which includes the gross mark-up, a percentage which is complementary to the percentage of net mark-up. Manifestly, when cost of sales is computed by applying to the sales figure, which includes the gross mark-up, a percentage which is complementary to the percentage of net mark-up, cost of sales is overstated, and, in that circumstance, the *753result of cost of opening inventory plus cost of purchases minus cost of sales is less than the cost value of the closing inventory. We can readily appreciate the reason for the agreement of the parties that petitioner’s formula produced fairly accurate results during 1916, 1917,1918, and 1919, when compared with physical inventories priced at cost, since the mark-doAvns of those years were but 1.25, .43, .47, and .72 per cent, respectively, of the retail values of the merchandise stock; but it is obvious, from what already has been said, that as appreciable increases in mark-downs are made, as is the case in 1920 and 1921, when they amounted to 4.50 and 3.58 per cent, respectively, there will be a proportionately greater discrepancy due to the error in the formula. Were it not for this error in the petitioner’s formula, the resulting inventory valuations would have been $407,564.14 for 1920, and $403,960.18 for 1921, which amounts are equal to those percentages of the retail value of the inventories of those years which are complementary to the respective percentages of mark-up, and there would have been no conflict, in that respect, with any principle of the retail inventory method. Respondent points out that the formula used by the petitioner for determining the inventories, under the retail inventory method, does not conform with article 1588 of Regulations 62, and that is undoubtedly true. At least, the immediate results of that formula are not what are contemplated by those regulations, and this is due to the error in computing the cost of sales which we have pointed out. On the other hand, it is equally clear that the formula used by the respondent does not conform with the regulations. Article 1588 of Regulations 62 provides: Inventories of retail merchants. — Retail merchants who employ what is known as the “ retail method ” of pricing inventories may make their returns upon that basis, provided that the use of such method is designated upon the return, that accurate accounts are kept, and that such method is consistently adhered to unless a change is authorized- by the Commissioner. Under this method the goods in the inventory are ordinarily priced at the selling prices, and the total retail value of the goods in each department or of each class of goods is reduced to approximate cost by deducting the percentage which represents the difference between the retail selling value and the purchase price. This percentage is determined by departments of a store or by classes of goods, and should represent as accurately as may be the amounts added to the cost prices of the goods to cover selling and other expenses of doing business and for the margin of profit. In computing the percentage above mentioned, proper adjustment should be made for all mark-ups and mark-downs. A taxpayer maintaining more than one department in his store or dealing in classes of goods carrying different percentages of gross profit should not use a percentage of profit based upon an average of his entire business, but should compute and use in valuing his inventory the proper percentages for the respective departments or classes of goods. *754The regulations require that the percentage of mark-up shall be computed upon the basis of the net mark-up. That is the only construction which can be placed on the provision which requires that “ In computing the percentage above mentioned, proper adjustment should be made for all mark-ups and mark-downs,” for the only way of carrying this provision into effect is to offset the mark-downs against the mark-ups before computing the percentage of mark-up. The respondent has computed the percentage of mark-up upon the basis of the gross mark-up, which procedure, for the reasons stated, does not conform with the regulations. Had he computed the inventories in the manner seemingly required by the regulations, he would have determined their values to be $407,564.14 for 1920, and $403,-960.18 for 1921, which are the same as would have resulted under the petitioner’s formula were it not for the error in computing cost of sales. However, there is this irony in respondent’s action — that, if his assumption that all mark-downs have been actually taken on goods sold and there have been no mark-downs on the goods in the inventories is well founded, he has come closer to an actual cost valuation of the inventories by his formula than he would have had he followed the procedure contemplated by the regulations. As a usual rule the formula used by respondent is not suitable for determining the cost valuation of the inventory, because when there have been mark-downs it is seldom that the inventory does not include some of the marked-down goods; and where there are mark-down goods in the inventory it is obvious that the inventory does not contain the percentage of gross mark-up the complement of which is to be applied to the retail value of the inventory to determine its value. If the unusual circumstances in the respondent’s assumption exist, and there is no evidence to the contrary, the formula he has used will result in a cost valuation as closely approximating actual cost as is possible under the -retail inventory method. The effect of the procedure outlined in the regulations is to spread the markdowns ratably over every dollar of sales and every dollar of retail value in the inventory. This procedure might be justified when the inventory is known to contain marked-down goods and the markdowns can not be segregated as to goods sold and goods in the inventory; but in the actual or assumed circumstances that no markdowns were made on the goods in the inventory, the procedure is obviously improper in the determination of the cost value of the inventory. There is no proof in the record which challenges the correctness ,of the cost values of the inventories determined by the respondent. *755Petitioner has rested its entire case on the grounds that the formula adopted in 1916 is a proper one for determining the cost valuations of the inventories and that its inventory practice has been consistent, in the use of that formula, since 1916. These grounds we have found to be erroneous; and lacking proof of error- in the inventory values determined by respondent, those values must stand. The last question is whether the petitioner made false and fraudulent returns for the years 1919, 1920, and 1921, with intent to evade tax. The respondent has asserted the fraud penalty as to each of those years, and the hearing herein having been had prior to the enactment of the Revenue Act of 1828, the burden is upon the petitioner to show the returns were not false and fraudulent. The facts concerning the several transactions at issue, and on which the respondent’s determination of fraud is apparently predicated, are fully set forth in the findings of fact herein, and we do not deem it necessary to restate them. It is sufficient to say that in our opinion the ¡ictitioner has sustained the burden of proof as to this issue. It is true that the evidence shows that its returns for the years involved contained statements which were untrue, and that it claimed deductions to which it is not entitled. However, the petitioner has shown that these statements were not made with intent to mislead or defraud, and that it believed, and still believes, that it is entitled to the deductions claimed. We are satisfied that the returns were not false or fraudulent with intent to evade tax, "and we so hold. At the hearing the respondent, by an amendment to his answer, prayed that in the event we should hold that the petitioner’s returns for any of the years involved were not false and fraudulent with intent to evade tax, we should also hold that the petitioner was negligent in the preparation and filing of such returns, and that the negligence penalty should be asserted. We have carefully considered this phase of the case and we are of opinion that on the record the assertion of the negligence penalty is not warranted. Reviewed by the Board. Judgment will Se entered under Rule SO. Van Fossan concurs in the result. Smith dissents on the fourth point, regarding inventories.

2020-01-17 22:01:45.741975+00

Fossan

*759OPINION. Van Fossan: Petitioner deducted and respondent disallowed as an ordinary and necessary expense for the year ending April 30, 1921, an item of $49,190, the amount representing the par value of certain stock issued to one of its stockholders pursuant to the reso*760lution of its board of directors April 16, 1920, quoted in full in the finding's of fact. Said stock was voted “ as compensation to him for the executive services heretofore rendered to the company without stipulated salary.” The services to which reference was made began in 1916, when the company was expanding its activities, and consisted particularly of negotiations conducted by Heddon in securing the extension of a lease from a 40-year term to a 99-year term; his assistance in floating a bond issue; the sale by Heddon to influential persons of $100,000 of petitioner’s stock; arranging for favorable credit terms on equipment purchased, and assisting in adjusting relations between petitioner and its creditors. Substantially all of these services were rendered during 1916, 1917, and 1918. There is no evidence from which we can draw any conclusion of fact as to the nature, extent or value, if any, of Heddon’s services subsequent to 1918. The inference is that they were minor or negligible. When Heddon’s active assistance was first enlisted there was an oral understanding between him and the Hustons that if the business proved successful Heddon would be appropriately compensated. Whether this understanding attained to the dignity of a bindihg legal obligation it is not necessary to decide. However, no terms were fixed; no standards of value were set up; no payment was to be made unless and until success was achieved; there was no obligation that could be accrued each year on petitioner’s books. Cf. Adams, Payne & Gleaves, 9 B. T. A. 1076. The obligation first became fixed in 1920, pursuant to the resolution of the board of directors. Though the compensation was voted in 1920, the facts show that there was no causal or direct relation between it and the services rendered in the taxable year. It was actually in consideration of services rendered in prior years and by no stretch of reasoning could be held, on the record before us, to be reasonable compensation for services rendered in the year 1920. See Green Oil Soap Co., 3 B. T. A. 467; Roubaix Mills, Inc., 7 B. T. A. 878. Furthermore, it is fundamental that to be allowable not only must the expense be incurred in the taxable year, but, if in compensation for services, it must be reasonable in amount. We have considerable evidence of the nature of the services performed but we are furnished no gauge or standard by which thejr should be tested to ascertain their value or the reasonableness of the amount allowed. Were this the only question confronting us we would be left very largely to conjecture as to the reasonable worth of the services. Yet another obstacle besets petitioner’s path in the nature and character of the services rendered. So far as the record shows the services were chiefly of aid in perfecting petitioner’s capital structure and fall within the category of capital expenditures. See J. Alland *761& Bro., Inc., 1 B. T. A. 631; Emerson Electric Mfg. Co., 3 B. T. A. 932. In any event, it is impossible on the record to segregate clearly the services of a capital nature from those which might be classed as expense. In view of our conclusion indicated above it is unnecessary to discuss the legal effect of the cancellation, on the day following its issuance to Heddon, of the stock certificate and the reissuance of the same aggregate amount to Heddon and the two Hustons in equal shares. Judgment wiU he entered for the respondent.

2020-01-17 22:01:45.77998+00

Mtjrdock

*763OPINION. MtjRdock : The respondent in his answer raises the point that the letter of November 24, 1925, is not a deficiency notice within the meaning of section 274 (a) of the Eevenue Act of 1924 and asserts that the Board is without jurisdiction by reason of that fact. We are of the opinion that the letter of November 24, 1925, constituted a final determination of a 'deficiency, from which an appeal could be taken to this Board. Joseph Garneau Co., 1 B. T. A. 75; Terminal Wine Co., 1 B. T. A. 697; Florence M. Smith, Executrix, 5 B. T. A. 225; Mutual Building & Investment Co., 11 B. T. A. 999. The sole issue on the merits for determination in this proceeding is whether or not the petitioner has the right to have its excess-profits taxes for the years 1917 and 1918 computed in accordance with the provisions of section 210 of the Revenue Act of 1917 and sections 327 and 328 of the Revenue Act of 1918. The petitioner contends, first, that its invested capital can not be determined and, second, that certain abnormal conditions existed during the taxable years in question, both in invested capital and in *764income. The conditions which the petitioner contends render it impossible to determine the invested capital, or which are abnormal, are: First, the acquisition of water rights for power purposes which rights were never valued upon the books of the corporation and by the use of which a saving ivas effected; second, the reduction in the year 1916 in the patent account by the sum of $51,000; third, the development over a period of years of certain secret processes embodied in various machines which were used by the petitioner in the manufacture of its products and which effected a substantial saving for each of the years involved in this appeal. The water rights were evidenced by shares of stock. Shares of stock are to be regarded as tangible property for invested capital purposes under both revenue acts applicable to this case. We need not discuss whether or not these shares are inadmissibles. In the deed of conveyance from the trustees of the Harmony Society for the factory site there was particular reference to the water power, it being stated that 30 shares of water power (stock), each share being equal to 1/200 part of all the water power furnished by the Beaver Falls Water Power Co., were included in the conveyance. There is, however, no evidence to show that stock of the petitioner was issued therefor. On the contrary the evidence shows that such water-j>ower shares were acquired without any consideration other than the location of the factory at Beaver Falls. The Revenue Act of 1917, section 207, defining invested capital, provides that it shall include actual cash paid in, actual cash value of tangible property paid in other than cash for stock or shares, paid-in or earned surplus and undivided profits used or employed in the business. It will be observed that tangible propertjr must either have been paid in for stock or shares or come within the category of paid-in or earned surplus. Not having been transferred for shares of the petitioner, Ihe water power shares can not be included in invested capital unless they can be regarded as paid-in surplus. ,We are satisfied that they can not be so regarded. Frank Holton & Co., 10 B. T. A. 1317, and authorities there cited. It is apparent, therefore, that the water rights in question do not constitute such assets as may be included in invested capital, and as a consequence any impossibility of determining their value can not contribute to or give rise to a condition under which invested capital can not be determined. The petitioner calls attention to the write-off from patent account in the year 1916. This write-off consisted of $51,000 and diminished the patents to the sum of $10,000. The petitioner’s treasurer testified that the patents were written down because the company was ultraconservative in its methods of bookkeeping and the directors *765could not see the use of a patent account other than a nominal amount merely to show that patents were held. Some of the patents had expired at the time the patent account was written down. The petitioner has not shown us what took place on the organization of the company in regard to the patents. We do not know whether it was the original patentee or whether it acquired such patents from others. We are unable to find that the patents were paid in for stock or shares. Nor do we know the dates of -the patents or whether the petitioner acquired such patents at or after its organization by payment for them in cash or tangible property. We are therefore unable to say whether any amount should be included in invested capital by reason of the value of such patents under the Revenue Act of 1917. The same observation applies to the taxable year 1918 under the provisions of section 826 (a) (4). Under these circumstances we can not say that the write-down in the account would form a basis for special assessment. The petitioner next calls attention to certain secret processes embodied in machines built and developed in its plant by its employees. Only one of the ideas embodied in such machines was patented and that one in 1889 at the time of the corporation’s organization. All of the development expense in connection with these secret processes and machines was charged to expense in the years in which such expenses were incurred, no portion of it being capitalized. It is the contention of the petitioner that the amounts expended in developing the secret processes and the design, construction and erection of machinery by which such processes were perfected are capital expenditures. These processes were not acquired upon the organization of the petitioner but were built up over a series of years in the course of its operations. The petitioner would be entitled to include in its invested capital its expenditures made in perfecting its secret processes and the machines embodying such processes upon a showing of the amounts so expended. Goodell-Pratt Co., 3 B. T. A. 30. It contends that to determine the cost of building up the processes is impossible. We are not convinced, however, that it is impossible to determine this cost. There has been no showing that any attempt has ever been made to go back over the books and charge this cost to capital or to determine whether the amounts could be identified. So far as we know the amounts were capable of accurate determination. This case falls within the principles laid down in the case of Edwin M. Knowles China Co., 9 B. T. A. 1292, in which we said that the special relief given by the statute was not intended for those taxpayers whose invested capital is small merely because they have not taken the trouble to *766establish the larger amount to which they might be entitled. See also Cramer & King, 13 B. T. A. 399. We next come to a consideration of the question whether there exists one or more abnormal conditions affecting the capital or income of the corporation, such as to entitle the petitioner to special assessment. The water rights as we have heretofore pointed out are not such assets as might be taken into account in computing invested capital. Their exclusion under the statute from invested capital does not give rise to an abnormal condition affecting invested capital, that is, mere statutory exclusion without a showing of some other condition is not an abnormal condition within the meaning of this section. Morris & Co., 1 B. T. A. 704. See also William B. Dana Co., 11 B. T. A. 92; J. H. Guild Co., 11 B. T. A. 914, 920; Clarence Whitman & Sons, Inc., 11 B. T. A. 1192. It may be that an asset might be excluded from invested capital and by reason of peculiar circumstances connected with such asset an abnormal condition might exist but we see no such circumstances here. Our previous discussion in regard to the secret processes sufficiently disposed of this question for all purposes of the case, for without a showing that the failure to have the cost of these processes included in invested capital was not due to the petitioner’s own indifference and lack of industry in the preparation of the case, we need not concern ourselves with whether or not there was an abnormal condition affecting capital or income in this same connection. Edwin M. Knowles China Co., supra. However, we will discuss briefly the petitioner’s testimony that these secret processes effected considerable savings in its business, which testimony was offered for the purpose of showing an abnormality. The petitioner’s operating manager testified that in his opinion these secret processes effected certain savings per annum and he stated what in his opinion these savings amounted to. However, there are not facts before us from which we could test his opinion and counsel was frank enough to admit that the opinion of the witness was little better than a guess.. Another witness gave his opinion as to the cost of these processes. These figures were also admittedly mere estimates. We are not sufficiently convinced of the correctness of the figures to make a definite finding of fact in regard to them. Thus, it does not appear that the effect of the secret processes is so substantial as to create an abnormal condition affecting capital or income. See C. Bruno & Sons, Inc., 14 B. T. A. 103. Judgment will he entered for the respondent.

2011-08-23 09:34:07+00

http://bulk.resource.org/courts.gov/c/F2/732/732.F2d.939.83-1276.html

732 F.2d 939 F & J Contracting v. John Deere 83-1276 United States Court of Appeals, Fifth Circuit. 4/18/84 1 N.D.Tex. AFFIRMED

2020-01-17 22:01:45.882235+00

Millikbn

*771OPINION. Millikbn: The sole question for decision is whether payments of taxes for payment of interest on local improvement bonds are deductible or not in computing net income. The Bevenue Act of 1921 provides as follows : Seo. 214. (a) That in computing net income there shall be allowed as deductions : ******* (2) All interest paid or accrued within the taxable year on indebtedness * * * (3) Taxes paid or accrued within the taxable year except * * * (e) taxes assessed against local benefits of a kind tending to increase the value of the property assessed * * *. If the payments under consideration were payments of interest on indebtedness of the taxpayer, they are deductible under clause (2), but if they were taxes assessed against local benefits they are not deductible. The pleadings are not definite and specific as to the organization and actions taken by the several drainage districts, but as they are not questioned we will assume that they were regularly and duly organized under the laws of Missouri and that, in assessing the benefits, levying of taxes, and issuing bonds and interest coupons, the *772officials of the several districts complied with the law in such cases made and provided. Special assessments or taxes for local benefits are levied because of the special benefit derived by the property which is assessed, and it is because of this benefit that such taxes are upheld. Sections 4378, 4379, 4380, Missouri Eevised Statutes, provide for the formation of drainage districts to protect and reclaim land and other property from the effects of water for sanitary or agricultural purposes, or when it may be conducive to the public health, convenience or benefit. Sections 4381, 4382, 4383, and 4384 provide for the election and qualification of the board of supervisors. Section 4385 provides for the appointment of a chief engineer to make surveys and report a plan for reclamation. Section 4387 empowers the supervisors to levy a uniform tax of not exceeding 50 cents per acre for the payment of organization and preliminary expenses, and section 4388 provides for the appointment of commissioners by the judge of the circuit court “ to appraise the lands within and without said district to be acquired for rights of way, holding basins and other drainage works of the district, and to assess benefits and damages accruing to all lands in the district and other property by reason of the execution of the plan for reclamation.” Section 4390 relates to the duties of the Commissioners and requires them to assess the amount of benefits.and damages, if any, accruing to each piece of property affected by the plan of reclamation. Section 4393 empowers the supervisors to build, construct, or contract for the works of improvement, and section 4394 authorizes the supervisors “ to levy a tax of such portion of said benefits on all lands, railroad and other property in the district to which benefits have been assessed, as may be found necessary by the board of. supervisors to pay the costs of the completion of the proposed works and improvements.” It is further provided that the tax shall be apportioned to and levied on each tract of land in proportion to the benefits received and assessed and that if bonds are issued, then the amount of the interest on such bonds shall be included in the tax. A number' of other sections follow not pertinent to this inquiry, except sections 4418 and 4427, which are copied in our findings of fact. By section 4418 the board of supervisors is authorized to issue bonds not to exceed 90 per cent of the total amount of the taxes levied and to bear interest not to exceed the rate of 6 per cent per annum. It is further provided that a sufficient amount of the drainage tax shall be appropriated by the board for the purpose of paying the principal and interest of said bonds and that in making the annual tax levy it should be the duty of the supervisors to take into account the maturing bonds and interest on all bonds and to make ample provisions in advance for the payment thereof. Funds de*773rived from the sale of the bonds are to be used for paying the cost of the drainage works and necessary expenses authorized by law. From this examination of the Missouri statutes, it is clear that drainage districts are organized for local purposes and that taxes levied to carry out those purposes are assessed against and levied upon property therein in proportion to the benefit received and not in excess thereof. Provisions directing the commissioners to appraise the lands and assess damages, if any, expressly require them to assess the “ benefits ” to each tract, and the supervisors in assessing and levying the drainage tax are expressly restricted to the benefits derived in fixing the amount of the tax. Whatever part of the tax was used in payment of the interest on the bonds was not a separate payment of interest as such, or a separate tax for that purpose. Nor was it a payment of interest on any personal indebtedness of petitioner. He was merely paying the drainage tax assessed against his property. The indebtedness upon which interest was paid was that of the drainage districts and was paid by them and not him. Under section 4418 the supervisors were authorized to include interest on bonds in the drainage tax. The Supreme Court of Missouri in Birmingham Drainage District v. Chicago, etc., 266 Mo. 60; 178 S. W. 893, held the Missouri laws relating to drainage districts constitutional and held that an assessment for the construction of improvements in a drainage district does not create an indebtedness in the form of taxes within the constitutional limitation of taxation, since sums assessed against property as benefits are not public taxes. We had practically the same question before us in F. A. Smith et al., 11 B. T. A. 301, and there held that taxes for drainage district purposes were not deductible, nor was the amount paid to pay interest* on bonds issued for such purposes. It was there said: The petitioners contend, first, that the taxes in question are constitutional taxes for a public purpose and as such are deductible under section 214(a) (3) of the Revenue Act of 1921; and, second, that if they are not such taxes, then the amount thereof used for paying interest on the bonds is deductible under section 214(a) (2) of the 1921 Act as interest paid. We do not deem it necessary to go into the constitutional and statutory provisions of the law of Texas with reference to the taxes in question. The Supreme Court of Texas has held the payments to be taxes for local improvements cr, in other words, assessments. See Dallas County Levee District No. 2 v. Looney, 207 S. W. 310; Dallas County Levee Improvement District No. 3 v. Ayers et al., 246 S. W. 1112. In Caldwell Milling Co., 3 B. T. A. 1232, the Board construed section 234(a) (3) (c) of the Revenue Act of 1918 to mean special or local assessments as a class and as such not deductible. Our reasoning therein applies with equal force to the provision of section 214(a) (3) (c) of the 1921 Act. It is clear, therefore, that petitioners’ first contention is unsound and can not be sustained. *774However, petitioners contend that that part of the assessment paid in 1923 which was used for the purpose of paying interest on the bonds issued by Houston Levee District No. 1 is deductible as interest paid under section 214(a) (2) of the 1921 Act. With this contention we can not agree. The bonds were the obligation of the Levee District and not of the individuals. The assessment of the taxes in question can not be said to constitute a payment of interest on a personal obligation. The Commissioner’s action is, therefore, sustained. We think this decisive of the case under consideration and the action of the respondent in disallowing the deductions is approved. This ruling and the case of F. A. Smith et al., supra, are not in conflict with the case of Evens & Howard Fire Brick Co., 8 B. T. A. 867, where we held that interest on an apportionment warrant for street improvements was deductible although the amount of the warrant was not deductible, but there was a controlling difference. In the instant case and the Smith case, supra, interest-bearing bonds of a drainage district were issued and a tax levied and assessed to pay principal and interest, while in the Evens <& Howard case, supra, a street improvement apportionment warrant was issued against taxpayer for its proportionate part of the cost, and because of failure to pay when due interest was added as a penalty. It was no part of the tax, while here the interest is. Compare, also, Appeal of Caldwell Milling Co., 3 B. T. A. 1232. Petitioner further suggests that the drainage supervisors were not restricted to benefits in levying tax for interest, but there is no showing that they exceeded the benefits derived. Judgment will be entered for respondent.

2020-12-02 01:00:20.355391+00

http://www.ca5.uscourts.gov/opinions/unpub/20/20-10408.0.pdf

Case: 20-10408 Document: 00515657011 Page: 1 Date Filed: 12/01/2020 United States Court of Appeals for the Fifth Circuit United States Court of Appeals Fifth Circuit FILED December 1, 2020 No. 20-10408 Lyle W. Cayce Summary Calendar Clerk United States of America, Plaintiff—Appellee, versus Terrol Debaun Travis, Defendant—Appellant. Appeal from the United States District Court for the Northern District of Texas USDC No. 4:19-CR-270-1 Before Higginbotham, Jones, and Costa, Circuit Judges. Per Curiam:* Terrol Debaun Travis appeals the sentence imposed after his guilty plea conviction for possession of a firearm by a felon. He maintains that the district court erred by applying the provisions of the Armed Career Criminal Act (ACCA), 18 U.S.C. § 924 (e), and imposing enhanced punishment. He * 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: 20-10408 Document: 00515657011 Page: 2 Date Filed: 12/01/2020 No. 20-10408 contends that, for purposes of the ACCA, his prior convictions in Texas for possession with intent to deliver a controlled substance and for aggravated assault with a deadly weapon do not constitute predicate offenses. Travis asserts that his conviction in Texas for possession with intent to deliver a controlled substance does not qualify as a “serious drug offense” under the ACCA because the statute of conviction can be violated by an offer to sell. However, as he admits, his claim is foreclosed. See United States v. Cain, 877 F.3d 562 , 562-563 (5th Cir. 2017); United States v. Vickers, 540 F.3d 356 , 364-65 (5th Cir. 2008). He also argues that his conviction in Texas for aggravated assault with a deadly weapon is not a “violent felony” under the ACCA because the crime can be committed with a mens rea of recklessness and does not require the use, attempted use, or threatened use of physical force. His challenge, as he acknowledges, is foreclosed. See United States v. Torres, 923 F.3d 420 , 425- 26 (5th Cir. 2019); United States v. Gracia-Cantu, 920 F.3d 252 , 253-54 (5th Cir.), cert. denied, 140 S. Ct. 157 (2019); United States v. Gomez Gomez, 917 F.3d 332 , 333-34 (5th Cir. 2019), petition for cert. filed (U.S. July 19, 2019) (No. 19-5325). The Government has filed an unopposed motion for summary affirmance and, alternatively, requests an extension of time to file its brief. Because the issues presented on appeal are foreclosed, summary affirmance is proper. See Groendyke Transp., Inc. v. Davis, 406 F.2d 1158 , 1162 (5th Cir. 1969). Thus, the Government’s motion for summary affirmance is GRANTED, the Government’s alternative motion for an extension of time to file a brief is DENIED, and the judgment of the district court is AFFIRMED. 2

2020-12-02 01:00:21.287215+00

http://www.ca5.uscourts.gov/opinions/unpub/20/20-10165.0.pdf

Case: 20-10165 Document: 00515656747 Page: 1 Date Filed: 12/01/2020 United States Court of Appeals for the Fifth Circuit United States Court of Appeals Fifth Circuit FILED December 1, 2020 No. 20-10165 Lyle W. Cayce Summary Calendar Clerk United States of America, Plaintiff—Appellee, versus Kiandrick Onick, Defendant—Appellant. Appeal from the United States District Court for the Northern District of Texas USDC No. 4:16-CR-25-1 Before Davis, Stewart, and Dennis, Circuit Judges. Per Curiam:* Kiandrick Onick pleaded guilty to possession of a firearm by a felon, and he was sentenced below the advisory guideline range to 32 months of imprisonment and three years of supervised release. After a remand for resentencing, United States v. Onick, 702 F. App’x 231, 233 (5th Cir. 2017), * 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: 20-10165 Document: 00515656747 Page: 2 Date Filed: 12/01/2020 No. 20-10165 the district court resentenced Onick to time served, with a three-year term of supervised release. Onick began serving his term of supervised release on February 28, 2018. On March 26, 2019, the probation officer filed a petition charging that Onick had violated the mandatory conditions of his supervised release that he not commit another federal, state, or local crime, and that he not possess an illegal controlled substance. The report also alleged that Onick submitted four urine specimens that tested positive for marijuana, which violated his mandatory conditions of release, and that he violated the condition that he participate in a drug treatment and testing program by failing to report to submit urine specimens seven times. Based on these alleged violations, Onick was subject to mandatory revocation under 18 U.S.C. § 3583 (g), which requires revocation and a term of imprisonment for defendants found to have committed certain gun or drug violations. Onick objected that the mandatory revocation feature of § 3583(g) was unconstitutional under United States v. Haymond, 139 S. Ct. 2369 (2019). The district court rejected his argument and sentenced Onick to 11 months of imprisonment, with no additional term of supervised release. Because Onick preserved his challenge, our review is de novo. United States v. Garner, 969 F.3d 550 , 551 (5th Cir. 2020). In Haymond, the Supreme Court held that a different mandatory revocation provision, § 3583(k), violates the Fifth and Sixth Amendments. 139 S. Ct. at 2373 . Onick argues that the Court’s reasoning in Haymond invalidating § 3583(k) applies with equal force to § 3583(g). However, we rejected Onick’s exact argument in Garner, concluding that § 3583(g) “lacks the three features which led the Court to hold § 3583(k) unconstitutional.” Id. at 551. Specifically, we stated that (1) Subsection (g) applied more generally to violations of common supervised released conditions, while Subsection (k) applied only when a 2 Case: 20-10165 Document: 00515656747 Page: 3 Date Filed: 12/01/2020 No. 20-10165 defendant committed a discrete set of criminal offenses; (2) Subsection (g), unlike Subsection (k), did not dictate the length of the sentence imposed for the violation; and (3) Subsection (g), unlike Subsection (k), did not prescribe a sentence that was based on the violation, but instead granted the judge discretion to impose any sentence authorized under the general revocation statute. Id. at 553. Based on the differences between § 3583(k) and § 3583(g), we held that § 3583(g) “is not unconstitutional under Haymond.” Id. AFFIRMED. 3

2020-12-02 01:00:22.133065+00

http://www.ca5.uscourts.gov/opinions/unpub/20/20-60447.0.pdf

Case: 20-60447 Document: 00515656929 Page: 1 Date Filed: 12/01/2020 United States Court of Appeals for the Fifth Circuit United States Court of Appeals Fifth Circuit FILED December 1, 2020 No. 20-60447 Lyle W. Cayce Summary Calendar Clerk United States of America, Plaintiff—Appellee, versus Anthony Robinson, Defendant—Appellant. Appeal from the United States District Court for the Northern District of Mississippi USDC No. 3:19-CR-99-1 Before Haynes, Willett, and Ho, Circuit Judges. Per Curiam:* Anthony Robinson appeals the below-guidelines 36-month sentence he received following his convictions for cyberstalking, in violation of 18 U.S.C. § 2261A(2)(A), and possession of a firearm by a felon, in violation of 18 U.S.C. § 922 (g). He argues that the district court failed to provide an * 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: 20-60447 Document: 00515656929 Page: 2 Date Filed: 12/01/2020 No. 20-60447 explanation of the sentence sufficient to indicate that it had considered his mitigating argument related to COVID-19 and that such failure amounted to reversible procedural error. Because Robinson did not raise this claim of procedural error in the district court, review is limited to plain error. See United States v. Neal, 578 F.3d 270 , 272 (5th Cir. 2009). 1 To demonstrate plain error, he must show a forfeited error that is clear or obvious and that affects his substantial rights. See Puckett v. United States, 556 U.S. 129 , 135 (2009). If he makes such a showing, this court has the discretion to correct the error but only if it seriously affects the fairness, integrity, or public reputation of judicial proceedings. Id. However, we determine that the standard of review is not determinative here. Robinson has not shown any error, plain or otherwise. The record establishes that the district court thoroughly considered and in fact accepted his mitigating arguments, including the mitigating arguments raised in his sentencing memorandum, when concluding that a below-guidelines sentence was appropriate, and it clearly stated the reasons for selecting the sentence imposed. See United States v. Sanchez, 667 F.3d 555 , 568 (5th Cir. 2012); see also Rita v. United States, 551 U.S. 338 , 356-59 (2007). The district court did not procedurally err by failing to explicitly or separately address his COVID- 19 argument. See United States v. Becerril-Pena, 714 F.3d 347 , 351-52 (5th Cir. 2013); Sanchez, 667 F.3d at 568 . 2 1 Robinson argues that this issue was preserved, citing Holguin-Hernandez v. United States, 140 S. Ct. 762 (2020). That case addressed substantive reasonableness and expressly declined to address the procedural question raised here. Id. at 766-67 . Although Robinson raised the issue of COVID-19 in his filings, he never argued that the district court failed to explain its reasoning. 2 Under plain error review, Robinson would clearly fail the second, third, and fourth prongs. He fails to cite any case or statute that requires consideration of a pandemic 2 Case: 20-60447 Document: 00515656929 Page: 3 Date Filed: 12/01/2020 No. 20-60447 Accordingly, the district court’s judgment is AFFIRMED. in determining the length of a sentence, so any error would not be plain. He fails to show that the sentence would have been different if the district court had explicitly discussed it, so he fails the third prong. We would not exercise our discretion to remand this case, given that he received a below-guidelines sentence and nothing suggests that a district court is required to reduce a sentence based solely on the existence of a pandemic in the jails and prisons. 3

2020-12-02 01:00:22.499051+00

http://www.ca5.uscourts.gov/opinions/unpub/20/20-50164.0.pdf

Case: 20-50164 Document: 00515656965 Page: 1 Date Filed: 12/01/2020 United States Court of Appeals for the Fifth Circuit United States Court of Appeals Fifth Circuit FILED December 1, 2020 No. 20-50164 Lyle W. Cayce Summary Calendar Clerk United States of America, Plaintiff—Appellee, versus Alexis Ortega-Marufo, also known as Alexis Ortega-Marrufo, Defendant—Appellant. Appeal from the United States District Court for the Western District of Texas No. 4:19-CR-723-3 Before King, Smith, and Wilson, Circuit Judges. Per Curiam:* Alexis Ortega-Marufo appeals his sentence for importation of and pos- session with intent to distribute marihuana. He asserts that he should have received the minor-role adjustment under U.S.S.G. § 3B1.2 because he was * Pursuant to 5th Circuit Rule 47.5, the court has determined that this opin- ion should not be published and is not precedent except under the limited circumstances set forth in 5th Circuit Rule 47.5.4. Case: 20-50164 Document: 00515656965 Page: 2 Date Filed: 12/01/2020 No. 20-50164 substantially less culpable than the average participant in the criminal activ- ity. Citing Application Note 3(A) to § 3B1.2, he observes that a drug courier who is accountable only for the quantity he personally transported is eligible for the adjustment. He contends that the district court’s rationale for deny- ing the adjustment—his criminal history—was not implicated by the factors in the commentary to § 3B1.2. According to Ortega-Marufo, those factors instead supported the adjustment because he was similarly situated to his co- defendants as a mere backpacker who did not guide or lead the group, plan the trip, drive the participants, exercise decisionmaking authority, or finan- cially profit from the drug-trafficking activity. We review the district court’s application of the guidelines de novo and its factual finding that a defendant was a not minor participant for clear error. United States v. Gomez-Valle, 828 F.3d 324 , 327 (5th Cir. 2016). A finding is not clearly erroneous if it is plausible in light of the record as a whole. Id. “We may affirm on any ground supported by the record.” United States v. Luyten, 966 F.3d 329 , 332 (5th Cir. 2020). Contrary to the government’s assertion, “[t]he fact that a defendant performs an essential or indispensable role in the criminal activity is not de- terminative.” § 3B1.2, comment. (n.3(C)); see Gomez-Valle, 828 F.3d at 329. Even a defendant who plays an essential role may receive the minor-role adjustment if he “is substantially less culpable than the average participant in the criminal activity.” U.S. Sent’g Guidelines Manual § 3B1.2 cmt. n.3(c) (U.S. Sent’g Comm’n 2005). The record plausibly supports the district court’s finding that Ortega- Marufo was an average participant, rather than one who was substantially less culpable than the average participant. His role as a courier is not determina- tive. See United States v. Buenrostro, 868 F.2d 135 , 138 (5th Cir. 1989). Of the five people who illegally crossed the border from Mexico with a total of 2 Case: 20-50164 Document: 00515656965 Page: 3 Date Filed: 12/01/2020 No. 20-50164 86.12 kilograms of marihuana in their backpacks, Ortega-Marufo alone knew that the marihuana was being transported to Odessa, Texas. Additionally, he was the only one with a criminal record. Tellingly, it involved a recent con- viction for the same conduct of illegally crossing the border near Marfa, Texas, with a large quantity of marihuana. Those facts together indicated that Ortega-Marufo had a greater understanding of the scope and structure of the criminal activity than did the other participants, a relevant factor in determining whether he should receive the adjustment. See § 3B1.2, com- ment. (n.3(C)). The district court was not required to make an express find- ing on it. See United States v. Torres-Hernandez, 843 F.3d 203 , 209−10 (5th Cir. 2016). Because the finding that Ortega-Marufo was an average participant in the criminal activity is plausible in light of the record as a whole, the court did not err by denying the minor-role adjustment. See § 3B1.2, comment. (n.3(A), (C)); Gomez-Valle, 828 F.3d at 327; Luyten, 966 F.3d at 332. The judgment is AFFIRMED. 3

2020-12-02 01:00:23.801588+00

http://www.ca5.uscourts.gov/opinions/pub/17/17-50282-CV1.pdf

REVISED IN THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT United States Court of Appeals Fifth Circuit FILED November 23, 2020 No. 17-50282 Lyle W. Cayce Clerk PLANNED PARENTHOOD OF GREATER TEXAS FAMILY PLANNING AND PREVENTATIVE HEALTH SERVICES, INCORPORATED; PLANNED PARENTHOOD SAN ANTONIO; PLANNED PARENTHOOD CAMERON COUNTY; PLANNED PARENTHOOD GULF COAST, INCORPORATED; PLANNED PARENTHOOD SOUTH TEXAS SURGICAL CENTER; JANE DOE, I; JANE DOE 2; JANE DOE 4; JANE DOE 7; JANE DOE 9; JANE DOE 10; JANE DOE 11, Plaintiffs–Appellees, v. SYLVIA HERNANDEZ KAUFFMAN, in her official capacity as Inspector General of HHSC; CECILE ERWIN YOUNG, in her official capacity as Executive Commissioner of HHSC, Defendants–Appellants. Appeal from the United States District Court for the Western District of Texas USDC No. 1:15-CV-1058 Before OWEN, Chief Judge, and JOLLY, JONES, SMITH, STEWART, DENNIS, ELROD, SOUTHWICK, HAYNES, GRAVES, HIGGINSON, COSTA, WILLETT, HO, DUNCAN, ENGELHARDT, Circuit Judges. ∗ ∗ JUDGE OLDHAM is recused and did not participate in the decision. JUDGE WILSON joined the court after this case was submitted and did not participate in the decision.  No. 17-50282 PRISCILLA R. OWEN, Chief Judge, joined by JOLLY, JONES, SMITH, ELROD, SOUTHWICK, HAYNES, WILLETT, HO, DUNCAN and ENGELHARDT, Circuit Judges: ∗∗ In this interlocutory appeal of a preliminary injunction, the dispositive issue is whether 42 U.S.C. § 1396a(a)(23) gives Medicaid patients a right to challenge, under 42 U.S.C. § 1983 , a State’s determination that a health care provider is not “qualified” within the meaning of § 1396a(a)(23). Our decision rests primarily on two independent bases: (1) the Supreme Court’s decision in O’Bannon v. Town Court Nursing Center, 1 and (2) the text and structure of § 1396a(a)(23), which does not unambiguously provide that a Medicaid patient may contest a State’s determination that a particular provider is not “qualified”; whether a provider is “qualified” within the meaning of § 1396a(a)(23) is a matter to be resolved between the State (or the federal government) and the provider. We overrule the decision by a panel of this court 2 that the district court duly followed in the present case. Accordingly, we vacate the preliminary injunction. I Five Medicaid providers were among the plaintiffs in the district court and are appellees in this court. They are Planned Parenthood Gulf Coast, Inc. (PP Gulf Coast), headquartered in Houston; Planned Parenthood Greater Texas, Inc., headquartered in Dallas and providing services in parts of north and central Texas; and three providers—Planned Parenthood of Cameron County, Planned Parenthood San Antonio, and Planned Parenthood South ∗∗ JUDGE HAYNES concurs in the judgment and joins in the reasoning of Sections I, II, and V. 447 U.S. 773 (1980). 1 Planned Parenthood of Gulf Coast, Inc. v. Gee, 862 F.3d 445 (5th Cir. 2017), cert. 2 denied, 139 S. Ct. 408 (2018). 2  No. 17-50282 Texas Surgical Center—that the district court described as operating “under the umbrella of Planned Parenthood South Texas.” We will refer to the Medicaid providers collectively as the Providers. Seven individuals, to whom we will refer collectively as the Individual Plaintiffs, received or sought services from one or more of the Providers. The two defendants in the district court and the appellants in this court are the Executive Commissioner of the Texas Health and Human Services Commission, and that Commission’s Inspector General (OIG), in their respective official capacities. We will refer to the defendants collectively as HHSC. The Providers provide family planning and other health services to approximately 12,500 Medicaid patients at thirty health centers each year. Their services include examinations, cancer screenings, testing and treatment for sexually transmitted diseases, as well as basic healthcare for both men and women. Each of the Providers is a member of Planned Parenthood Federation of America (Planned Parenthood); they must adhere to certain medical and organizational standards to operate under the name “Planned Parenthood.” As participants in the Texas Medicaid program, the Providers entered into Medicaid provider agreements under which they are required to comply with all Texas Medicaid policies and applicable state and federal regulations. The OIG oversees compliance with state Medicaid policies. Texas law authorizes the OIG to conduct investigations and to terminate Medicaid provider agreements for noncompliance. 3 The OIG may terminate a Medicaid provider agreement when “prima facie evidence” establishes that a provider has committed a “program violation” or is “affiliated with a person who 3 1 TEX. ADMIN. CODE §§ 371.3, 371.1703(c) (2020). 3  No. 17-50282 commits a program violation.” 4 A “program violation” includes any violation of federal law, state law, or the Texas Medicaid program policies. In 2015, the Center for Medical Progress (CMP), a pro-life organization, released video recordings of conversations that occurred at PP Gulf Coast headquarters. The CMP videos depict two individuals posing as representatives from a fetal tissue procurement company discussing the possibility of a research partnership with PP Gulf Coast. The release of these videos prompted congressional investigations. The Senate Judiciary Committee released a report, 5 as did a House Select Investigative Panel of the Committee on Energy and Commerce. 6 An alternative report to the House Committee’s report was issued by committee members in the minority. 7 In October 2015, the OIG sent each Provider a Notice of Termination of its respective Medicaid provider agreement, stating that each was “no longer capable of performing medical services in a professionally competent, safe, legal, and ethical manner.” The Notice listed the bases for termination and stated that, unless the Providers responded within thirty days, a Final Notice of Termination would issue. The Providers and Individual Plaintiffs sued in federal court to block the terminations. They asserted that the terminations violated rights conferred 4 Id. §§ 371.1703(c), (c)(6)-(7). 5 MAJORITY STAFF OF S. COMM. ON THE JUDICIARY, 114TH CONG., MAJORITY REPORT ON HUMAN FETAL TISSUE RESEARCH: CONTEXT AND CONTROVERSY (Comm. Print 2016), https://www.grassley.senate.gov/sites/default/files/judiciary/upload/22920%20-%20FTR.pdf. 6 SELECT INVESTIGATIVE PANEL OF THE ENERGY & COM. COMM., 114TH CONG., FINAL REPORT xviii-xix (Comm. Print 2017), https://www.govinfo.gov/content/pkg/CPRT- 114HPRT24553/pdf/CPRT-114HPRT24553.pdf. 7 DEMOCRATIC MEMBERS, SELECT INVESTIGATIVE PANEL OF THE ENERGY & COM. COMM., 114TH CONG., SETTING THE RECORD STRAIGHT: THE UNJUSTIFIABLE ATTACK ON WOMEN’S HEALTH CARE & LIFE-SAVING RESEARCH (Comm. Print 2016), https://www.stemexpress.com/wp/wp-content/uploads/2018/01/20161228-Full-Dem- Report.pdf. 4  No. 17-50282 by 42 U.S.C. § 1396a(a)(23) and sought relief under § 1983. They also contended that the OIG’s actions violated their Fourteenth Amendment Equal Protection rights. The OIG sought a stay of proceedings, which the district court granted, pending the issuance of a Final Notice of Termination. The OIG then sent the Final Notice. The Final Notice stated that the Inspector General had determined that the Providers were “not qualified to provide medical services in a professionally competent, safe, legal[,] and ethical manner under the relevant provisions of state and federal law pertaining to Medicaid providers.” The OIG based this conclusion on the CMP videos, evidence provided by the United States House of Representatives’ Select Investigative Panel, and the OIG’s consultation with its Chief Medical Officer. The Final Notice stated that “numerous violations of generally accepted standards of medical practice” had occurred and asserted that PP Gulf Coast had engaged in misrepresentations. The Notice also stated that under the OIG’s regulations, affiliates of a terminated entity are subject to termination. 8 The Providers and Individual Plaintiffs thereafter filed an amended complaint and a new motion for a preliminary injunction. The district court conducted a three-day evidentiary hearing, during which it reviewed the CMP videos and heard testimony from medical and ethics experts. The OIG introduced evidence that, it asserts, shows PP Gulf Coast violated federal regulations relating to fetal tissue research by altering abortion procedures for research purposes or allowing the researchers themselves to be involved in performing abortions. 9 8 See 1 TEX. ADMIN. CODE § 371.1703(c)(7). 9 See 42 U.S.C. § 289g-1(b)(2)(A)(ii) (requiring researchers to certify that “no alteration of the timing, method, or procedures used to terminate the pregnancy was made solely for the purposes of obtaining the tissue”); id. § 289g-1(c)(4) (requiring researchers to certify that 5  No. 17-50282 Following the hearing, the district court issued a memorandum and order granting the Providers and Individual Plaintiffs’ motion for a preliminary injunction and prohibiting the termination of the Providers’ Medicaid provider agreements. 10 The district court held that § 1396a(a)(23) granted rights to the Individual Plaintiffs upon which a § 1983 action challenging the OIG’s termination decision could be based. 11 The district court concluded from the evidence adduced at the preliminary injunction hearing that the Individual Plaintiffs were likely to succeed on the merits of their § 1983 claim because the OIG “did not have prima facie . . . evidence, or even a scintilla of evidence, to conclude the bases of termination set forth in the Final Notice merited finding the . . . Providers were not qualified.” 12 This appeal ensued. A three-judge panel of this court held, based on Planned Parenthood of Gulf Coast, Inc. v. Gee, 13 that the Individual Plaintiffs could maintain a § 1983 suit. 14 The panel also held that the district court abused its discretion by reviewing the agency’s decision de novo rather than applying the arbitrary and capricious standard and by considering factual matters beyond those contained they “had no part in any decisions as to the timing, method, or procedures used to terminate the pregnancy made solely for the purposes of the research”); 45 C.F.R. § 46.204 (i) (requiring that “[i]ndividuals engaged” in research involving “[p]regnant women or fetuses” “have no part in any decisions as to the timing, method, or procedures used to terminate a pregnancy”). 10 Planned Parenthood of Greater Tex. Family Plan. & Preventative Health Servs., Inc. v. Smith, 236 F. Supp. 3d 974 , 1000 (W.D. Tex. 2017). 11 Id. at 988 . 12 Id. at 998 . 13 862 F.3d 445 (5th Cir. 2017), cert. denied, 139 S. Ct. 408 (2018). 14 See Planned Parenthood of Greater Tex. Family Plan. & Preventative Health Servs., Inc. v. Smith, 913 F.3d 551 , 554, 559-62 (5th Cir. 2019). 6  No. 17-50282 in the administrative record that was before the HHSC. 15 We granted en banc review. 16 The preliminary injunction issued by the district court was based solely on the claims of the Individual Plaintiffs. The district court did not consider whether the Providers were entitled to a preliminary injunction. 17 The question before us is whether the Individual Plaintiffs may bring a § 1983 suit to contest the State’s determination that the Providers were not “qualified” providers within the meaning of 42 U.S.C. § 1396a(a)(23). We hold that they may not. We accordingly vacate the preliminary injunction. Because the district court did not consider the Providers’ claims, no aspect of those claims is before us in this interlocutory appeal. Accordingly, we do not reach an issue addressed by JUDGE HIGGINSON’s opinion concurring in part and dissenting in part, which is whether the Medicaid agreements of entities affiliated with PP Gulf Coast were properly terminated. 18 15 Id. at 569. 16 Planned Parenthood of Greater Tex. Family Plan. & Preventative Health Servs., Inc. v. Smith, 914 F.3d 994 , 996 (5th Cir. 2019) (mem.). 17 Planned Parenthood of Greater Tex. Family Plan. & Preventative Health Servs., Inc. v. Smith, 236 F. Supp. 3d 974 , 988 (W.D. Tex. 2017) (“The Court need not conclude all Plaintiffs have a substantial likelihood of prevailing on the Medicaid Act claim for a preliminary injunction to issue at this time. If Plaintiffs satisfy the elements needed to show a substantial likelihood of success on the Individual Plaintiffs’ § 1396a(a)(23) claim only, so long as the other factors are met, a preliminary injunction is appropriate. Accordingly, because this Court [hold]s the Individual Plaintiffs have a right of action, it need not decide whether the Provider Plaintiffs also have such a right, either on their own behalf or on the behalf of their patients.” (citations omitted)). 18 See HIGGINSON, J., concurring in part and dissenting in part, post at 65. 7  No. 17-50282 II “A preliminary injunction is an ‘extraordinary remedy’ . . . .” 19 Applicants must show: (1) a substantial likelihood of success on the merits, (2) a substantial threat of irreparable injury if the injunction is not issued, (3) that the threatened injury if the injunction is denied outweighs any harm that will result if the injunction is granted, and (4) that the grant of an injunction will not disserve the public interest. 20 “We review a preliminary injunction for abuse of discretion, reviewing findings of fact for clear error and conclusions of law de novo.” 21 When a district court applies incorrect legal principles, it abuses its discretion. 22 We first consider whether the Individual Plaintiffs have a right under § 1396a(a)(23) to challenge a determination that a Medicaid provider is not “qualified.” If they do not have such a right, then our inquiry is at an end because without a right that can be vindicated by a § 1983 action, the Individual Plaintiffs cannot bring this suit. Section 1983 supplies remedies for “the deprivation of any rights, privileges, or immunities secured by the Constitution and laws.” 23 The Supreme Court’s seminal decision in Gonzaga University v. Doe 24 explained, repeatedly, that “[s]ection 1983 provides a remedy only for the deprivation of 19 Texans for Free Enter. v. Tex. Ethics Comm’n, 732 F.3d 535 , 536 (5th Cir. 2013) (quoting Byrum v. Landreth, 566 F.3d 442 , 445 (5th Cir. 2009)). 20 Id. at 537 (quoting Byrum, 566 F.3d at 445 ). 21 Id. (emphasis omitted) (citing Janvey v. Alguire, 647 F.3d 585 , 595 (5th Cir. 2011)). 22 See Atchafalaya Basinkeeper v. U.S. Army Corps of Eng’rs, 894 F.3d 692 , 696 (5th Cir. 2018). 23 42 U.S.C. § 1983 . 24 536 U.S. 273 (2002). 8  No. 17-50282 rights” and that “it is rights, not the broader or vaguer benefits or interests, that may be enforced under the authority of that section.” 25 The Individual Plaintiffs rely upon 42 U.S.C. § 1396a(a)(23) as the source of their right to challenge the termination of the Providers’ Medicaid agreements. This provision is sometimes referred to as the “any-qualified- provider” or “free-choice-of-provider” provision. Under subpart 23(A) of the statute, a State Medicaid plan must permit an individual eligible for medical assistance to obtain that assistance from any “qualified” provider who undertakes to provide such services: (a) Contents A State plan for medical assistance must— .... (23) provide that (A) any individual eligible for medical assistance (including drugs) may obtain such assistance from any institution, agency, community pharmacy, or person, qualified to perform the service or services required (including an organization which provides such services, or arranges for their availability, on a prepayment basis), who undertakes to provide him such services . . . . 26 The statute provides in subpart 23(B) that a State’s Medicaid plan must also provide that an individual eligible for medical assistance who is enrolled in certain managed care systems or organizations cannot be restricted from obtaining “family planning services and supplies” 27 from the “qualified person” of his or her choice: 25 Id. at 283 (emphasis in original) (internal quotation marks omitted); see also id. at 285 (explaining that the inquiry “is to determine whether . . . a statute ‘confer[s] rights on a particular class of persons’” (alteration in original) (quoting California v. Sierra Club, 451 U.S. 287 , 294 (1981))). 26 42 U.S.C. § 1396a(a)(23)(A). 27 Id. at § 1396d(a)(4)(C) (defining eligible costs and services to include “family planning services and supplies furnished (directly or under arrangements with others) to 9  No. 17-50282 (a) Contents A State plan for medical assistance must— .... (23) provide that . . . (B) an enrollment of an individual eligible for medical assistance in a primary care case- management system (described in section 1396n(b)(1) of this title), a medicaid managed care organization, or a similar entity shall not restrict the choice of the qualified person from whom the individual may receive services under section 1396d(a)(4)(C) of this title, except as provided in subsection (g), in section 1396n of this title, and in section 1396u-2(a) of this title, except that this paragraph shall not apply in the case of Puerto Rico, the Virgin Islands, and Guam, and except that nothing in this paragraph shall be construed as requiring a State to provide medical assistance for such services furnished by a person or entity convicted of a felony under Federal or State law for an offense which the State agency determines is inconsistent with the best interests of beneficiaries under the State plan or by a provider or supplier to which a moratorium under subsection (kk)(4) is applied during the period of such moratorium . . . . 28 Both subparts (A) and (B) use the term “qualified” as a modifier in describing a provider from whom a person eligible for Medicaid assistance may obtain care or supplies. In O’Bannon v. Town Court Nursing Center, 29 the Supreme Court determined that individuals who are Medicaid beneficiaries do not have a right under 42 U.S.C. § 1396a(a)(23) to contest a state or federal agency’s determination that a Medicaid provider is not “qualified.” 30 The question addressed by the Supreme Court in O’Bannon was whether Medicaid beneficiaries residing in a nursing home “have a constitutional right individuals of child-bearing age (including minors who can be considered to be sexually active) who are eligible under the State plan and who desire such services and supplies”). 28 Id. at § 1396a(a)(23)(B). 29 447 U.S. 773 (1980). 30 Id. at 785-86 . 10  No. 17-50282 to a hearing before a state or federal agency may revoke the home’s authority to provide them with nursing care at government expense.” 31 The Department of Health, Education and Welfare had notified the nursing home that it “no longer met the statutory and regulatory standards for skilled nursing facilities and that, consequently, its Medicare provider agreement would not be renewed.” 32 A state agency followed suit. 33 The nursing home and residents who were Medicaid beneficiaries brought an action in federal court contending that, under the Due Process Clause, they “were entitled to an evidentiary hearing on the merits of the decertification decision before the Medicaid payments were discontinued.” 34 In addressing this claim, the Supreme Court confirmed that the Due Process Clause does not confer a “right to a hearing” in the abstract; rather, it does so only as a prerequisite to a deprivation of “life, liberty, or property.” 35 Accordingly, for the O’Bannon beneficiaries to prevail on their due process claim, they had to show that the termination of the nursing home’s Medicaid agreement “amount[ed] to a deprivation of an[] interest in life, liberty, or property.” 36 31 Id. at 775 ; see also id. at 784 (explaining that the “question is whether the patients have an interest in receiving benefits for care in [the nursing home] that entitles them, as a matter of constitutional law, to a hearing before the Government can decertify that facility”). 32 Id. at 776 . 33 Id. 34 Id. at 777 ; see Brief for Respondents at 26, O’Bannon v. Town Ct. Nursing Ctr., 447 U.S. 773 (1980) (No. 78-1318) (“The Patients’ right to pre-termination process is based upon their right not to be deprived of ‘life, liberty, or property, without due process of law . . .’ as guaranteed by the Fifth and Fourteenth Amendments to the United States Constitution.” (alteration in original)). 35 O’Bannon v. Town Ct. Nursing Ctr., 447 U.S. 773 , 788, 790 (1980); see U.S. CONST. amend. XIV, § 1. 36 O’Bannon, 447 U.S. at 787 ; see also Ky. Dep’t of Corrs. v. Thompson, 490 U.S. 454 , 460 (1989) (“We examine procedural due process questions in two steps: the first asks whether there exists a liberty or property interest which has been interfered with by the State; the second examines whether the procedures attendant upon that deprivation were constitutionally sufficient.” (citations omitted) (first citing Bd. of Regents of State Colls. v. Roth, 408 U.S. 564 , 571 (1972); and then citing Hewitt v. Helms, 459 U.S. 460 , 472 (1983))). 11  No. 17-50282 The O’Bannon Medicaid beneficiaries contended that because 42 U.S.C. § 1396a(a)(23) granted them the right to obtain services from any qualified provider, they had a property right to remain in the home of their choice and, therefore, they had a right to a hearing to challenge whether cause existed for the termination of their preferred providers’ Medicaid agreements. 37 The Supreme Court rejected the beneficiaries’ argument. 38 The Court held that “the Court of Appeals failed to give proper weight to the contours of the right conferred by the statutes and regulations.” 39 The Court specifically identified the any-qualified-provider provision, § 1396a(a)(23), holding that “while a patient has a right to continued benefits to pay for care in the qualified institution of his choice, he has no enforceable expectation of continued benefits to pay for care in an institution that has been determined to be unqualified.”40 Therefore the patients did not have the right to question a state or federal agency’s determination that an institution was unqualified. The any-qualified- provider provision, the Court explained, was among statutes and regulations that “involve[] the Government’s attempt to confer an indirect benefit on Medicaid patients by imposing and enforcing minimum standards of care on facilities like” the nursing home. 41 The Court reasoned that “[w]hen enforcement of those standards requires decertification of a facility, there may be an immediate, adverse impact on some residents. But surely that impact, 37 O’Bannon, 447 U.S. at 779 , 779 n.8, 784 (explaining that the Court of Appeals had identified Medicaid provisions, including 42 U.S.C. § 1396a(a)(23), that gave “Medicaid recipients the right to obtain services from any qualified facility,” and that the nursing home patients contended these provisions “g[a]ve them a property right to remain in the home of their choice absent good cause for transfer and therefore entitle[d] them to a hearing on whether such cause exist[ed]”). 38 Id. at 785. 39 Id. at 786. 40 Id. 41 Id. at 787. 12  No. 17-50282 which is an indirect and incidental result of the Government’s enforcement action, does not amount to a deprivation of any interest in life, liberty, or property.” 42 Consequently, the patients had no right under § 1396a(a)(23)(A) to challenge the decertification decision. 43 In O’Bannon, the Court explained that § 1396a(a)(23) “gives [Medicaid] recipients the right to choose among a range of qualified providers, without government interference” and “[b]y implication, . . . also confers an absolute right to be free from government interference with the choice to remain in a home that continues to be qualified.” 44 The Court juxtaposed these granted rights with those that § 1396a(a)(23) “clearly does not confer,” beginning with the right “to enter an unqualified home and demand a hearing to certify it.”45 Most relevant here, the Court explicitly stated that § 1396a(a)(23) does not grant Medicaid beneficiaries the right “to continue to receive benefits for care in a home that has been decertified.” 46 In reaching this conclusion, the Court noted that “decertification does not reduce or terminate a patient’s financial assistance, but merely requires him to use it for care at a different facility.” 47 The O’Bannon beneficiaries also argued that being transferred to another nursing home “may have such severe physical or emotional side effects that it is tantamount to a deprivation of life or liberty.” 48 The Court rejected this argument as well. The Court compared Medicaid beneficiaries whose preferred provider has been decertified to patients without Medicaid whose preferred provider’s license has been revoked, reasoning that, while “[b]oth 42 Id. 43 Id. at 775, 785. 44 Id. at 785 (emphasis in original). 45 Id. 46 Id. 47 Id. at 785-86. 48 Id. at 784. 13  No. 17-50282 may be injured by the closing of a [provider] due to revocation of [the provider’s] state license or [the provider’s] decertification as a Medicaid provider[,] . . . [neither patient] would have any claim against the responsible governmental authorities for the deprivation of an interest in life, liberty, or property.” 49 Having concluded that the termination of the nursing home’s Medicaid provider agreement “did not directly affect the patients’ legal rights or deprive them of any constitutionally protected interest in life, liberty, or property,” 50 the Court determined that the Medicaid beneficiaries did not have a due process right to a hearing on whether the federal and state agencies were justified in terminating the nursing home’s Medicaid provider agreement. 51 The Supreme Court’s decision in O’Bannon resolves this case. 52 It establishes that § 1396a(a)(23) does not give Medicaid beneficiaries a right to question a State’s determination that a provider is unqualified. Medicaid beneficiaries have an “absolute right” under § 1396a(a)(23) to receive services from a provider whom the State has determined is “qualified,” but beneficiaries have no right under the statute to challenge a State’s determination that a provider is unqualified. Because the Individual Plaintiffs do not have a right to continued benefits to pay for care from the Providers, they are not likely to prevail on the merits of their § 1983 claims and, as a result, are not entitled to a preliminary 49Id. at 787. 50Id. at 790. 51 Id. at 775, 785. 52 Accord Does v. Gillespie, 867 F.3d 1034 , 1047 (8th Cir. 2017) (SHEPHERD, J., concurring) (“O’Bannon controls the outcome of this case. The plaintiffs are asserting a right—the absolute right to a particular provider of their choosing—that § 23(A) does not grant them.”). 14  No. 17-50282 injunction. 53 Accordingly, the injunction issued by the district court, which was based entirely on the § 1983 claims of the Individual Plaintiffs, 54 must be vacated. III Even absent O’Bannon’s holding, the text of § 1396a(a)(23) does not unambiguously grant Medicaid patients the right to be involved in or to contest a state agency’s determination that a provider is not “qualified.” The any- qualified-provider provision expressly contemplates that the chosen provider is both “qualified” and willing to provide the services sought. 55 The two requirements cannot be divorced from one another. It is a chicken-and-egg proposition. A provider is not eligible to be chosen unless both conditions are met—that it is qualified and willing to provide services. The most natural reading of § 1396a(a)(23) is that it is up to the provider to establish that it is both “qualified” and willing to provide the services. A Medicaid patient is not involved in a provider’s willingness to accept Medicaid procedures, regulations, and reimbursement rates. Additionally, whether a provider is “qualified” is largely a factual determination with the facts more readily available to the provider, not the Medicaid patient. If a state agency or actor determines that a particular provider is not qualified, in most if not all cases, it is the provider who has the most incentive to contest such a finding and to seek a resolution. It requires a strained reading of § 1396a(a)(23) to conclude that a Medicaid patient has the independent right to have a particular provider declared “qualified” when the provider itself does not challenge a 53 See Tex. Med. Providers Performing Abortion Servs. v. Lakey, 667 F.3d 570 , 574 (5th Cir. 2012) (quoting Bluefield Water Ass’n, Inc. v. City of Starkville, Miss., 577 F.3d 250 , 252 (5th Cir. 2009)). 54 See Planned Parenthood of Greater Tex. Family Plan. & Preventative Health Servs., Inc. v. Smith, 236 F. Supp. 3d 974 , 987-88 (W.D. Tex. 2017). 55 See 42 U.S.C. § 1396a(a)(23)(A). 15  No. 17-50282 finding that it is not qualified. It requires an equally strained reading of § 1396a(a)(23) to conclude that it is only when a provider itself contests a finding that it is not “qualified” that a Medicaid patient has the right to have that particular provider declared “qualified” in the face of the contrary finding. Where is the language in § 1396a(a)(23) that grants a right to a Medicaid patient, either independent of the provider’s right or exercised in tandem with the provider, to have a particular provider declared “qualified”? It is not there, 56 and that is why the Supreme Court held as it did in O’Bannon. A Medicaid patient may choose among qualified and willing providers but has no right to insist that a particular provider is “qualified” when the State has determined otherwise. In Gonzaga University, the Supreme Court “reject[ed] the notion that [its] cases permit anything short of an unambiguously conferred right to support a cause of action brought under § 1983.” 57 The Court explained that “[a] court’s role in discerning whether personal rights exist in the § 1983 context should . . . not differ from its role in discerning whether personal rights exist in the implied right of action context.” 58 In determining “whether Congress intended to create a federal right” the Supreme Court has held that “the question . . . is definitively answered in the negative whe[n] a statute by its terms grants no private rights to any identifiable class.” 59 The inquiry when determining if a statute grants a right “is to determine whether or not a statute ‘confer[s] rights on a particular class of persons.’” 60 “Accordingly, whe[n] the 56 See id. 57 Gonzaga Univ. v. Doe, 536 U.S. 273 , 283 (2002). 58 Id. at 285 . 59 Id. at 283-84 (emphasis in original) (internal brackets and quotation marks omitted) (quoting Touche Ross & Co. v. Redington, 442 U.S. 560 , 576 (1979)). 60 See id. at 285 (“[T]he initial inquiry—determining whether a statute confers any right at all—is no different from the initial inquiry in an implied right of action case, the 16  No. 17-50282 text and structure of a statute provide no indication that Congress intends to create new individual rights, there is no basis for a private suit, whether under § 1983 or under an implied right of action.” 61 The Gonzaga decision also re-emphasized “that it is only violations of rights, not laws, which give rise to § 1983 actions.” 62 The Court explained, to “seek redress through § 1983, . . . a plaintiff must assert the violation of a federal right, not merely a violation of federal law.” 63 The Supreme Court’s opinion in Armstrong v. Exceptional Child Center, Inc. 64 also supports the conclusion that Congress did not intend to create a right under § 1396a(a)(23) such that Medicaid patients could contest a State’s determination that a particular provider is not “qualified.” While the statute unambiguously provides that a Medicaid beneficiary has the right to obtain services from the qualified provider of her choice, § 1396a(a)(23) does not unambiguously say that a beneficiary may contest or otherwise challenge a determination that the provider of her choice is unqualified. In Armstrong the Supreme Court disavowed, in part, its decision in Wilder v. Virginia Hospital Ass’n 65 declaring in Armstrong that “our later opinions plainly repudiate the ready implication of a § 1983 action that Wilder exemplified. See Gonzaga Univ. v. Doe . . . (expressly ‘reject[ing] the notion,’ implicit in Wilder, ‘that our express purpose of which is to determine whether or not a statute ‘confer[s] rights on a particular class of persons.’” (alteration in original) (quoting California v. Sierra Club, 451 U.S. 287 , 294 (1981))). 61 Id. at 286. 62 Id. at 283 (emphasis in original) (citing Blessing v. Freestone, 520 U.S. 329 , 340 (1997)). 63 Id. at 282 (emphasis and alteration in original) (quoting Freestone, 520 U.S. at 340 ). 64 575 U.S. 320 (2015) (plurality opinion). 65 496 U.S. 498 (1990). 17  No. 17-50282 cases permit anything short of an unambiguously conferred right to support a cause of action brought under § 1983’).” 66 The right asserted by the Individual Plaintiffs is not unambiguously conferred. Section 1396a(a)(23) says that State Medicaid plans must “provide that . . . any individual eligible for medical assistance . . . may obtain such assistance from any institution, agency, community pharmacy, or person, qualified to perform the service or services required . . . who undertakes to provide him such services, and . . . an enrollment of an individual eligible for medical assistance in [certain entities] shall not restrict the choice of the qualified person from whom the individual may receive services.” 67 The only unambiguous directives are that a State must include such a provision in its Medicaid plan and that beneficiaries have the right to choose among qualified providers. This subsection does not say that a Medicaid patient has a right to contest a State’s determination that a provider is not “qualified.” The Individual Plaintiffs can only infer, at best, that if they have a right to obtain assistance from a “qualified” provider, then they have a right to contest a State’s determination that a particular provider is not “qualified” to perform the necessary services. But such an inference is not “an unambiguously conferred right.” 68 Neither the text nor the structure of § 1396a(a)(23) indicates that Congress intended to give Medicaid beneficiaries the right to intervene or otherwise interject themselves into state or federal administrative or court proceedings whose purpose is to determine whether a particular provider is 66 Armstrong, 575 U.S. at 330 n.* (citing Gonzaga, 536 U.S. at 283 ). 67 42 U.S.C. § 1396a(a)(23). 68 Gonzaga, 536 U.S. at 283 (“We now reject the notion that our cases permit anything short of an unambiguously conferred right to support a cause of action brought under § 1983.”). 18  No. 17-50282 “qualified.” Nor does the text or structure of § 1396a(a)(23) suggest that while state or federal administrative or court proceedings are ongoing to resolve the issue of a provider’s qualification, or after there is a final determination by the State that the provider is not “qualified,” a Medicaid patient has the right to litigate separately or anew whether her provider is “qualified.” If Congress had intended such a scheme with its inherent potential for conflict, that intent must have been plainly—unambiguously—expressed. 69 It was not. This conclusion is borne out by the text and structure of other closely related federal statutes. Statutory provisions, including other subsections of § 1396a, permit a State to exclude providers from Medicaid plans for a host of reasons, 70 while other statutory provisions, also including other subsections of § 1396a, mandate exclusion for various reasons. 71 Section 1396a(p)(3) provides that “the term ‘exclude’ includes the refusal to enter into or renew a participation agreement or the termination of such an agreement.” 72 None of these statutes suggest that Medicaid patients have a right to challenge whether, as either a factual or legal matter, a State’s exclusion or removal of a provider is permitted or mandated by these statutes. The any-qualified-provider provision is not analogous to the provision of the Medicaid Act at issue in Wilder v. Virginia Hospital Ass’n. 73 The Supreme 69 See id. at 290 (“In sum, if Congress wishes to create new rights enforceable under § 1983, it must do so in clear and unambiguous terms—no less and no more than what is required for Congress to create new rights enforceable under an implied private right of action.”). 70 See, e.g., 42 U.S.C. § 1396a(p)(1) (“In addition to any other authority, a State may exclude any individual or entity for purposes of participating under the State plan under this subchapter for any reason for which the Secretary could exclude the individual or entity from participation in a program under subchapter XVIII under section 1320a-7, 1320a-7a, or 1395cc(b)(2) of this title.”); id. § 1320a-7(b). 71 See, e.g., id. §§ 1396a(p)(2), 1320a-7(a). 72 Id. § 1396a(p)(3). 73 496 U.S. 498 (1990). 19  No. 17-50282 Court reasoned in Suter v. Artist M. 74 that “the Boren Amendment [the subject of Wilder] actually required the States to adopt reasonable and adequate rates, and that this obligation was enforceable by the providers.” 75 The Court continued, “[w]e relied in part on the fact that the statute and regulations set forth in some detail the factors to be considered in determining the methods for calculating rates.” 76 The language at issue in the present case is more akin to the statute under consideration in Suter v. Artist M., which was a provision in the Adoption Assistance and Child Welfare Act of 1980 (Adoption Act). 77 “The Adoption Act establishe[d] a federal reimbursement program for certain expenses incurred by the States in administering foster care and adoption services.” 78 To participate, a State was required to submit a plan to the Secretary of Health and Human Services for approval. 79 The Adoption Act required the plan to provide that “in each case, reasonable efforts will be made (A) prior to the placement of a child in foster care, to prevent or eliminate the need for removal of the child from his home, and (B) to make it possible for the child to return to his home.” 80 The plaintiffs sought, and the district court granted, injunctive relief requiring a state agency to assign a caseworker to each child placed in the agency’s custody within three working days of the time the case was first heard in state court, and to reassign a caseworker within three working days of the date any caseworker relinquished responsibility for 74 503 U.S. 347 (1992). 75 Id. at 359 . 76 Id. (citing Wilder, 496 U.S. at 519 n.17). 77 Id. at 350. 78 Id. at 350-51. 79 Id. at 351 (citing 42 U.S.C. §§ 670 , 671). 80 Id. (quoting 42 U.S.C. § 671 (a)(15) (1980) (amended 1997)). 20  No. 17-50282 a particular case. 81 Though the language of § 671(a)(15) would seemingly satisfy the first factor identified in Blessing v. Freestone, which is that “Congress must have intended that the provision in question benefit the plaintiff,” 82 the Supreme Court held that it did not confer rights upon which a § 1983 suit could be based. 83 The Court reasoned that the “reasonable efforts” directive “will obviously vary with the circumstances of each individual case. How the State was to comply with this directive, and with the other provisions of the Act, was, within broad limits, left up to the State.” 84 The Court then observed that “[o]ther sections of the Act provide enforcement mechanisms for the ‘reasonable efforts’ clause,” including the Secretary’s “authority to reduce or eliminate payments to a State on finding that the State’s plan no longer complies with § 671(a) or that ‘there is a substantial failure’ in the administration of a plan such that the State is not complying with its own plan.” 85 The Court observed that while these enforcement provisions “may not provide a comprehensive enforcement mechanism so as to manifest Congress’ intent to foreclose remedies under § 1983,” the Court concluded that “they do show that the absence of a remedy to private plaintiffs under § 1983 does not make the ‘reasonable efforts’ clause a dead letter.” 86 81 Id. at 352-53. 82 Blessing v. Freestone, 520 U.S. 329 , 340 (1997) (citing Wright v. City of Roanoke Redevelopment & Hous. Auth., 479 U.S. 418 , 430 (1987)). 83 Suter, 503 U.S. at 363 (“Careful examination of the language relied upon by respondents, in the context of the entire Act, leads us to conclude that the ‘reasonable efforts’ language does not unambiguously confer an enforceable right upon the Act’s beneficiaries. The term ‘reasonable efforts’ in this context is at least as plausibly read to impose only a rather generalized duty on the State, to be enforced not by private individuals, but by the Secretary in the manner previously discussed . . . . [We] conclude[] that § 671(a)(15) does not create a federally enforceable right to ‘reasonable efforts’ under § 1983 . . . .”). 84 Id. at 360. 85 Id. (citing 42 U.S.C. § 671 (b) (1980) (amended 1994)). 86 Id. at 360-61 . 21  No. 17-50282 The same can be said of the any-qualified-provider provision in § 1396a(a)(23). Whether a particular provider is “qualified” “will obviously vary with the circumstances of each individual case,” 87 and though courts are equipped to determine if a particular provider is qualified in the broad sense of that term, just as they are equipped to determine whether a child protective agency made “reasonable efforts” in a particular case, the fact that the courts could make such determinations if called upon by Congress is not dispositive. There must be a grant of a right to beneficiaries. 88 Further, the Medicaid Act leaves it up to a State to determine if a particular provider’s Medicaid agreement should be terminated because the provider is not “qualified” or terminated on other grounds. 89 There are enforcement mechanisms in the Medicaid Act analogous to those in the Adoption Act referenced by the Supreme Court in Suter. The Medicaid Act provides that the Secretary may reduce or eliminate payments to a state agency if the Secretary finds that state agency’s plan does not comply with 42 U.S.C. § 1396a 90 or “that in the administration of the plan there is a failure to comply substantially with any such provision” of § 1396a. 91 Though a Medicaid beneficiary does not have the right to contest, through a § 1983 suit, a determination that a particular provider is not qualified, that does not render the any-qualified-provider provision a “dead letter” for the same reasons that the “reasonable efforts” provision in Suter was not a “dead letter.” Under federal regulations promulgated under the Medicaid Act, a state Medicaid agency must provide an avenue for a provider to appeal a 87 Id. at 360. 88 See supra note 69. 89 See supra notes 68-69 and accompanying text. 90 See supra text accompanying note 85. 91 42 U.S.C. § 1396c. 22  No. 17-50282 determination that it is not “qualified.” 92 Texas has provided an administrative procedure for such appeals. 93 There is no analogous provision for Medicaid beneficiaries when a particular provider is deemed unqualified, indicating that there is no such right. If a Medicaid beneficiary is denied medical assistance, the Medicaid Act does provide some remedy. A State’s plan must “provide for granting an opportunity for a fair hearing before the State agency to any individual whose claim for medical assistance under the plan is denied or is not acted upon with reasonable promptness.” 94 We do not address today whether the Medicaid Act “provide[s] a comprehensive enforcement mechanism so as to manifest Congress’ intent to foreclose remedies under § 1983” 95 in a case in which a Medicaid beneficiary seeks care or services from a provider whom the State has determined is “qualified.” We do not reach that question for the same reason that the Supreme Court did not reach a similar question in Suter: “We need not consider this question today due to our conclusion that the [Medicaid] Act does not create the federally enforceable right asserted by respondents.” 96 Though the Medicaid Act, in § 1396a(a)(23), does give a Medicaid beneficiary the right to receive care or services from a provider that a State has determined is “qualified,” that provision does not unambiguously provide that a Medicaid beneficiary has the right to contest a State’s termination of a 92 42 C.F.R. § 455.422 (“The State Medicaid agency must give providers terminated or denied under § 455.416 any appeal rights available under procedures established by State law or regulations.”). 93 See 1 TEX. ADMIN. CODE § 371.1703(f)(2) (2020) (“A person may request an administrative hearing after receipt of a final notice of termination in accordance with § 371.1615 of this subchapter (relating to Appeals) unless the termination is required under 42 C.F.R. § 455.416 .”). 94 42 U.S.C. § 1396a(a)(3). 95 Suter v. Artist M., 503 U.S. 347 , 360 (1992). 96 Id. at 360 n.11. 23  No. 17-50282 provider’s Medicaid agreement on the basis that the provider is not “qualified” or the State’s determination that the agreement should be terminated on other grounds permissible under the Medicaid Act. IV At least six other circuit courts have considered whether § 1396a(a)(23) confers a right upon Medicaid beneficiaries that can be enforced under 42 U.S.C. § 1983 , 97 and there is a conflict. 98 The Eighth Circuit has concluded, as do we today, that § 1396a(a)(23) “does not unambiguously create a federal right for individual patients that can be enforced under § 1983.” 99 The Eighth Circuit recognized that the Medicaid Act is legislation enacted under the Spending Clause 100 that directs the Secretary of Health and Human Services to approve a State’s Medicaid plan if it “fulfills the conditions specified in subsection (a)” of § 1396a. 101 Subsection 23 is among “some eighty- three conditions” set forth in § 1396a(a). 102 The Eighth Circuit observed that the Medicaid Act is “a directive to the federal agency charged with approving state Medicaid plans,” 103 and “[e]ven whe[n] a subsidiary provision includes mandatory language that ultimately benefits individuals, a statute phrased as 97 Planned Parenthood S. Atl. v. Baker, 941 F.3d 687 (4th Cir. 2019); Planned Parenthood of Kan. v. Andersen, 882 F.3d 1205 (10th Cir. 2018), cert. denied, 139 S. Ct. 638 (2018); Does v. Gillespie, 867 F.3d 1034 (8th Cir. 2017); Planned Parenthood Ariz. Inc. v. Betlach, 727 F.3d 960 (9th Cir. 2013), cert. denied, 571 U.S. 1198 (2014); Planned Parenthood of Ind., Inc. v. Comm’r of Ind. State Dep’t of Health, 699 F.3d 962 (7th Cir. 2012), cert. denied, 569 U.S. 1004 (2013); Harris v. Olszewski, 442 F.3d 456 (6th Cir. 2006). 98 See Gee v. Planned Parenthood of Gulf Coast, Inc., 139 S. Ct. 408 , 408 (2018) (THOMAS, J., dissenting from denial of writ of certiorari). 99 Does, 867 F.3d at 1037. 100 Id. at 1039. 101 Id. at 1040 (quoting 42 U.S.C. § 1396a(b)). 102 Id. 103 Id. at 1041 (quoting Armstrong v. Exceptional Child Ctr., Inc., 575 U.S. 320 , 331 (2015) (plurality opinion)). 24  No. 17-50282 a directive to a federal agency typically does not confer enforceable federal rights on the individuals.” 104 Like the Eighth Circuit, we also see the potential for parallel litigation and conflicting results if Medicaid patients could bring a § 1983 suit challenging termination of a provider’s contract after state appellate proceedings had determined that the termination was proper and permissible. 105 If Congress contemplated such a regime, it must have created it in unambiguous terms. 106 In a health care system that is massive and costs taxpayers billions of dollars each year, it is difficult to conclude from so thin a read of § 1396a(a)(23) that Congress envisioned States spending additional millions of dollars defending suits in courts across the country brought by Medicaid patients when particular providers are excluded or terminated. We further agree with the Eighth Circuit that “[t]he absence of a remedy for patients under § 1983 . . . does not make the [any-qualified]-provider provision an empty promise.” 107 A Medicaid provider who wishes “to continue providing services ha[s] an obvious incentive to pursue administrative appeals and judicial review in state court if the alternative avenue of recruiting patients to sue in federal court is not available.” 108 Additionally, both providers and patients “may urge the Secretary to withhold federal funds from a State that fails to comply substantially with the conditions of § 23(A).” 109 The assertion in JUDGE DENNIS’s dissenting opinion that our holding today means that Medicaid beneficiaries “must meekly accept what choices the state allows” 104 Id. (citing Univs. Rsch. Ass’n, Inc. v. Coutu, 450 U.S. 754 , 756 n.1, 772-73 (1981)). 105 Id. at 1041-42. 106 See supra note 69. 107 Does, 867 F.3d at 1046. 108 Id. 109 Id. 25  No. 17-50282 rings particularly hollow. 110 Providers like the Planned Parenthood plaintiffs in the present case surely have the resources and motivation to contest termination of their Medicaid agreements through the state administrative process. 111 Individual providers, as noted earlier in this opinion, can contest termination of a Medicaid agreement if they remain willing to provide services to Medicaid recipients. However, five other circuits, the Fourth, Sixth, Seventh, Ninth, and Tenth, have held that § 1396a(a)(23) bestows a private right that Medicaid beneficiaries can vindicate through a § 1983 claim. 112 To the extent that these cases hold that a Medicaid patient has a right to contest, by means of a § 1983 suit or otherwise, a State’s determination that a provider is not “qualified” within the meaning of § 1396a(a)(23), we disagree that § 1396a(a)(23) unambiguously grants such a right for the reasons already considered in this opinion. In three cases from other circuits, a state actor or agency terminated a provider agreement or sought to exclude a provider solely on the basis that the provider or an affiliate performed abortions. 113 It is not clear whether any or 110 See DENNIS, J., dissenting, post at 81. 111 1 TEX. ADMIN. CODE § 371.1703(f)(2) (2020). 112 Planned Parenthood S. Atl. v. Baker, 941 F.3d 687 (4th Cir. 2019); Planned Parenthood of Kan. v. Andersen, 882 F.3d 1205 (10th Cir. 2018), cert. denied, 139 S. Ct. 638 (2018); Planned Parenthood Ariz. Inc. v. Betlach, 727 F.3d 960 (9th Cir. 2013), cert. denied, 571 U.S. 1198 (2014); Planned Parenthood of Ind., Inc. v. Comm’r of Ind. State Dep’t of Health, 699 F.3d 962 (7th Cir. 2012), cert. denied, 569 U.S. 1004 (2013); Harris v. Olszewski, 442 F.3d 456 (6th Cir. 2006). 113 Baker, 941 F.3d at 692 (“PPSAT was terminated solely because it performed abortions outside of the Medicaid program.”); Betlach, 727 F.3d at 962 (“The Arizona law extends the ineligibility [for the State’s Medicaid program] to non-abortion services such as gynecological exams and cancer screenings unless the patient’s provider agrees to stop performing privately funded elective abortions.”); Planned Parenthood of Ind., Inc., 699 F.3d at 967 (“The new law goes a step further [than forbidding federal funds to pay for most non- therapeutic abortions] by prohibiting abortion providers from receiving any state- 26  No. 17-50282 all of those circuits would permit a Medicaid patient to pursue a § 1983 claim asserting that a State’s finding that a provider was not “qualified” was erroneous, an abuse of discretion, arbitrary and unreasonable, or violated a statutory or constitutional provision. 114 Some of the circuits’ opinions have sought to distinguish the Supreme Court’s decision in O’Bannon by perceiving a right within § 1396a(a)(23) upon which Medicaid patients may sustain a suit against a state agency or actor. In Planned Parenthood South Atlantic v. Baker, the Fourth Circuit characterized O’Bannon as “sp[eaking] to the narrow question whether residents of a nursing home had a right to a pre-termination hearing before the state could close a home that all parties agreed was professionally ‘unqualified’ to render patient care.” 115 Similarly, the Tenth Circuit asserted that “O’Bannon addressed a . . . situation . . . [in which] no one contested that the nursing home was unqualified to perform the services.” 116 With great respect for our sister courts, those statements are demonstrably incorrect. Though the O’Bannon opinion reflects that Medicaid administered funds, even if the money is earmarked for other services. The point is to eliminate the indirect subsidization of abortion.” (emphasis in original)). 114 See Baker, 941 F.3d at 705 (recognizing that States “retain discretionary authority to disqualify providers as professionally incompetent for nonmedical reasons such as fraud and for any number of unprofessional behaviors,” but not addressing whether a Medicaid patient could sue under § 1983 to challenge a State’s particular qualification determination, nor what level of deference, if any, would be accorded to the State’s determination in such a suit); Betlach, 727 F.3d at 962, 972 (noting that § 1396a(p)(1) provides “states with authority to exclude providers on specified grounds,” but not addressing whether a Medicaid patient could sue under § 1983 to challenge a State’s particular qualification determination, nor what level of deference, if any, would be accorded to the State’s determination in such a suit); Planned Parenthood of Ind., Inc., 699 F.3d at 967-68, 979-80 (noting that the Medicaid Act outlines “specific grounds upon which states may bar providers from participating in Medicaid,” but not addressing whether a Medicaid patient could sue under § 1983 to challenge a State’s particular qualification determination, nor what level of deference, if any, would be accorded to the State’s determination in such a suit). 115 Baker, 941 F.3d at 704. 116 Andersen, 882 F.3d at 1231. 27  No. 17-50282 entities had decertified the nursing home based on findings that the home failed to meet numerous standards for skilled nursing facilities, 117 neither the nursing home nor its residents agreed with those assessments. The residents, who were Medicaid beneficiaries, along with the nursing home, filed suit in federal court contending “that both the nursing home and the patients were entitled to an evidentiary hearing on the merits of the decertification decision before the Medicaid payments were discontinued.” 118 Clearly, the Medicaid patients sought to challenge the agencies’ determination that the nursing home was no longer “qualified” to provide services within the meaning of § 1396a(a)(23). 119 The Medicaid beneficiaries in O’Bannon did not take the position, as the Fourth and Tenth Circuits’ decisions necessarily imply, that the nursing home was “professionally unqualified,” 120 but that the Medicaid residents nevertheless had a right to remain at the home, and Medicaid must continue paying for services performed by an unqualified provider. Instead, the Medicaid residents sought to challenge the determination that the nursing home was not a “qualified” provider. Several circuits, including a panel in our circuit, have attempted to distinguish O’Bannon by declaring that it involved only whether there was a right to due process and that it did not address whether the individuals receiving Medicaid assistance had substantive rights under § 1396a(a)(23).121 117 O’Bannon v. Town Ct. Nursing Ctr., 447 U.S. 773 , 775-76, 776 n.3 (1980). 118 Id. at 777 (emphasis added). 119 See id. 120 See Baker, 941 F.3d at 704 (internal quotation marks omitted). 121 See id. (“In point of fact, the patients [in O’Bannon] did not bring a substantive claim seeking to vindicate their rights under the [any-qualified]-provider provision, but rather sued for violation of their procedural due process rights.” (citing O’Bannon, 447 U.S. at 775 )); Andersen, 882 F.3d at 1231 (“[W]e note that the nursing home residents in O’Bannon asserted procedural due-process rights, not substantive rights, as the patients do here.”); Planned Parenthood of Gulf Coast, Inc. v. Gee, 862 F.3d 445 , 460 (5th Cir. 2017) (“[O’Bannon] is inapposite. There, the patient-plaintiffs’ injuries were alleged to stem from a deprivation 28  No. 17-50282 But this, too, is demonstrably incorrect. The Supreme Court made plain in O’Bannon that in order to resolve whether the right to due process entitled the Medicaid nursing home residents to a hearing on the merits of whether the provider was “qualified,” the Court had to determine whether § 1396a(a)(23) granted an underlying substantive right that would permit the residents to challenge a State’s determination that a provider is not qualified. 122 The Court held that there is no such substantive right. 123 The fact that the claim in O’Bannon was brought as a constitutional challenge rather than under § 1983 does not permit us to ignore the Supreme Court’s construction of § 1396a(a)(23), and it is not a basis for distinguishing O’Bannon, as the dissenting opinion of JUDGE DENNIS asserts in the present case. 124 An individual eligible for Medicaid assistance may have the right based on § 1396a(a)(23) that the Supreme Court identified in O’Bannon in dicta: “By implication, it also confers an absolute right to be free from government interference with the choice to remain in a home that continues to be qualified.” 125 But in each of the three sentences that follow the one just quoted, of due process rights, specifically, the right to a hearing to contest the state’s decertification of a health care provider, not just its Medicaid qualification. . . . In contrast, the Individual Plaintiffs here assert the violation of a substantive right.” (citing O’Bannon, 447 U.S. at 776 n.3)); Planned Parenthood of Ind., Inc. v. Comm’r of Ind. State Dep’t of Health, 699 F.3d 962 , 977 (7th Cir. 2012) (asserting that O’Bannon is a “due-process case” and that by contrast “Planned Parenthood and its patients are not suing for violation of their procedural rights; they are making a substantive claim that Indiana’s defunding law violates § 1396a(a)(23)” (emphasis in original)); see also DENNIS, J., dissenting, post at 86-87. 122 O’Bannon, 447 U.S. at 786 (“In holding that these provisions create a substantive right to remain in the home of one’s choice absent specific cause for transfer, the Court of Appeals failed to give proper weight to the contours of the right conferred by the statutes and regulations. As indicated above, while a patient has a right to continued benefits to pay for care in the qualified institution of his choice, he has no enforceable expectation of continued benefits to pay for care in an institution that has been determined to be unqualified.”). 123 See id. at 785-86 . 124 See DENNIS, J., dissenting, post at 86-87. 125 O’Bannon, 447 U.S. at 785 . 29  No. 17-50282 the Supreme Court made clear that § 1396a(a)(23) does not confer a right to contest, collaterally attack, or litigate a State’s determination that a provider is not “qualified.” The Court said: [First, § 1396a(a)(23)] clearly does not confer a right on a recipient to enter an unqualified home and demand a hearing to certify it, nor does it confer a right on a recipient to continue to receive benefits for care in a home that has been decertified. Second, although the regulations do protect patients by limiting the circumstances under which a home may transfer or discharge a Medicaid recipient, they do not purport to limit the Government's right to make a transfer necessary by decertifying a facility. Finally, since decertification does not reduce or terminate a patient’s financial assistance, but merely requires him to use it for care at a different facility, regulations granting recipients the right to a hearing prior to a reduction in financial benefits are irrelevant. 126 The central holding in O’Bannon was that regardless of whether the State’s qualification decision was correct, the individual beneficiaries did not have a right that would allow them to “demand a hearing” to challenge that determination. 127 The Sixth Circuit’s conclusion in Harris v. Olszewski that § 1396a(a)(23) creates a private right 128 was unnecessary to the judgment that it issued. In Harris, as a cost-savings measure, a Michigan agency contracted with only one provider of incontinence products after a competitive-bidding process. 129 A Medicaid beneficiary who used incontinence products filed suit seeking to certify a class and to enjoin enforcement of the single-source-provider contract 126 Id. at 785-86 (emphasis omitted). 127 Id. at 785. 128 Harris v. Olszewski, 442 F.3d 456 , 461-65 (6th Cir. 2006). 129 Id. at 460, 463 . 30  No. 17-50282 so the class could obtain supplies from other qualified providers. 130 The Sixth Circuit rendered judgment against the beneficiaries because it held that incontinence products are “medical devices” within the meaning of 42 U.S.C. § 1396n(a)(1)(B), and “medical devices” are excepted from the “freedom-of- choice provision” in § 1396a(a)(23) when a State acquires them through a competitive bidding process. 131 The Sixth Circuit addressed the threshold issue of whether § 1396a(a)(23) bestowed a right upon individuals receiving Medicaid assistance upon which a § 1983 suit could be based, even though it was not required to decide that issue in order to render the judgment that it did. Regardless, the Sixth Circuit’s conclusion that § 1396a(a)(23) confers a right upon which a § 1983 suit could be based is inapposite in the present context. The Medicaid beneficiaries in Harris sued to obtain access to additional qualified providers, not to contest the qualifications of the sole provider with whom Michigan’s Department of Community Health had contracted to obtain all incontinence supplies for Medicaid beneficiaries. 132 The Michigan agency had never determined that the suppliers from which the beneficiaries sought products were not “qualified” providers. 133 The qualifications of the existing supplier and the sought-after suppliers were simply not at issue. The Sixth Circuit’s conclusion that the Medicare beneficiaries had enforceable rights under § 1396a(a)(23) is consistent with the dicta in O’Bannon, which said that under § 1396a(a)(23), “a patient has a right to continued benefits to pay for care in the qualified institution of his choice.” 134 130 Id. at 460. 131 Id. at 465-69. 132 Id. at 460. 133 See id. at 459-60. 134 O’Bannon v. Town Ct. Nursing Ctr., 447 U.S. 773 , 786 (1980). 31  No. 17-50282 It does not contradict O’Bannon’s conclusion that § 1396a(a)(23) does not grant Medicaid beneficiaries a right to payments for care at institutions that a State has determined to be unqualified. V In concluding that 42 U.S.C. § 1396a(a)(23) does not give Medicaid patients the right to challenge a State’s determination that a particular Medicaid provider is unqualified, we expressly overrule Planned Parenthood of Gulf Coast, Inc. v. Gee. 135 The Gee case arose out of a Louisiana agency’s termination of the Medicaid provider agreements of two Louisiana clinics affiliated with PP Gulf Coast. 136 PP Gulf Coast and several Medicaid patients of the Louisiana clinics bypassed state administrative procedures and sued the Louisiana agency charged with managing its Medicaid program, the Louisiana Department of Health and Hospitals (LDHH), under 42 U.S.C. § 1983 , arguing that the clinics were “qualified” and that LDHH had failed to identify any valid ground under federal or state law for terminating their provider agreements. 137 After concluding that Medicaid patients had the right under § 1396a(a)(23) to bring a § 1983 suit to contest the termination of the providers, a divided panel of this court upheld a preliminary injunction enjoining LDHH from terminating the provider agreements. 138 The Gee opinion conflicts with the import of the Supreme Court’s decision in O’Bannon and whether § 1396a(a)(23) confers a private right of action upon Medicaid patients seeking 135 862 F.3d 445 (5th Cir. 2017). 136 Id. at 450-52 . 137 Id. at 450-53 . 138 Id. at 459, 473 . 32  No. 17-50282 to challenge a State’s determination that a Medicaid provider is not “qualified” within the meaning of that statute. We also disavow the conclusion in Gee that a state agency or actor cannot legitimately find that a Medicaid provider is not “qualified” unless under state or federal law the provider would be unqualified to provide treatment or services to the general public, including Medicaid patients who paid for the care or services with private funds. Federal law expressly allows States to terminate a provider’s Medicaid agreement on many grounds, including those articulated in the Medicaid Act, none of which contemplate that the provider must also be precluded from providing services to all non-Medicaid patients before termination is permissible. 139 For example, termination can occur because of a provider’s excessive charges; 140 fraud, kickbacks, or other prohibited activities; 141 failure to provide information; 142 failure to grant immediate access under specified circumstances; 143 or default on loan or scholarship obligations. 144 These provisions make clear that a state agency may determine that a Medicaid provider is unqualified and terminate its Medicaid provider agreement even if the provider is lawfully permitted to provide health services to the general public. Medicaid patients would 139 See, e.g., 42 U.S.C. § 1396a(p)(1) (“In addition to any other authority, a State may exclude any individual or entity for purposes of participating under the State plan under this subchapter for any reason for which the Secretary could exclude the individual or entity from participation in a program under subchapter XVIII under section 1320a-7, 1320a-7a, or 1395cc(b)(2) of this title.”); id. § 1320a-7(b)(6) (permitting exclusion for excessive charges or unnecessary services); id. § 1320a-7(b)(7) (permitting exclusion for “an act which is described in section 1320a-7a, 1320a-7b, or 1320a-8 of this title”); id. § 1320a-7a(a)(1)(A) (permitting exclusion for presenting a claim “for a medical or other item or service that the person knows or should know was not provided as claimed”). 140 Id. § 1320a-7(b)(6). 141 Id. § 1320a-7(b)(7). 142 Id. § 1320a-7(b)(9)-(11). 143 Id. § 1320a-7(b)(12). 144 Id. § 1320a-7(b)(14). 33  No. 17-50282 nevertheless be foreclosed from challenging the termination decision based on the holding in O’Bannon and the lack of unambiguous provisions in § 1396a(a)(23) conferring a right to challenge a State’s determination that a provider is not “qualified.” VI JUDGE DENNIS’s dissenting opinion asserts that this court is ignoring stare decisis. 145 An opinion of a panel does not bind the en banc court. Our court adheres to what we sometimes call the “rule of orderliness.” “It is a well- settled Fifth Circuit rule of orderliness that one panel of our court may not overturn another panel’s decision, absent an intervening change in the law, such as by a statutory amendment, or the Supreme Court, or our en banc court.” 146 “Indeed, even if a panel’s interpretation of the law appears flawed, the rule of orderliness prevents a subsequent panel from declaring it void.”147 But the court sitting en banc may overrule or abrogate a panel’s decision if the en banc court concludes that panel opinion’s holding was indeed flawed. No decision of this court has held that the court sitting en banc cannot overrule a prior panel decision unless it considers all the elements and principles embodied in the doctrine of stare decisis. That does not mean that principles underpinning the doctrine of stare decisis have no place in the en banc court’s decision about whether to overturn or abrogate a panel’s prior decision. But the analysis is not as exacting as that undertaken by the Supreme Court of the United States in applying the stare decisis doctrine, as it must, in deciding whether to overturn its own precedent. 145 See DENNIS, J., dissenting, post at 102-04. 146 Jacobs v. Nat’l Drug Intel. Ctr., 548 F.3d 375 , 378 (5th Cir. 2008) (emphasis omitted). 147 Id. 34  No. 17-50282 Nor does the failure of the en banc court to grant rehearing of a panel’s decision impart greater precedential value to that decision than it would have if no vote of the en banc court had occurred. A vote not to rehear a case en banc is no different in terms of stare decisis than the Supreme Court’s denial of a petition for certiorari. The Supreme Court is not precluded by stare decisis from considering the same issue, presented in a subsequent case, even though it previously declined to consider the precise issue by denying a petition for certiorari in a prior case. The en banc court is today overruling the decision of a panel of this court in Planned Parenthood of Gulf Coast, Inc. v. Gee. 148 The vote to grant rehearing in that case failed in an evenly divided vote (7 to 7). 149 The same issue has now been presented in the present case. The en banc court has concluded that the panel’s decision in Gee seriously misunderstood the import of the Supreme Court’s decision in O’Bannon v. Town Court Nursing Center 150 and failed to apply the Supreme Court’s construction of § 1396a(a)(23) in O’Bannon. That determination alone warrants overruling or abrogating the Gee decision, even were the doctrine of stare decisis fully applicable when a court of appeals sitting en banc weighs whether to overturn existing precedent established by a panel’s decision. * * * The preliminary injunction issued by the district court is VACATED. 148 862 F.3d 445 (5th Cir. 2017), cert. denied, 139 S. Ct. 408 (2018). 149 Planned Parenthood of Gulf Coast, Inc. v. Gee, 876 F.3d 699 , 699 (5th Cir. 2017) (mem.) (per curiam). 150 447 U.S. 773 (1980). 35  No. 17-50282 JENNIFER WALKER ELROD, Circuit Judge, joined by JONES, SMITH, WILLETT, HO, DUNCAN, and ENGELHARDT, Circuit Judges, concurring: I concur in full with Chief Judge Owen’s excellent majority opinion. First, as she observed, a conclusion that the qualified-provider provision confers a private right to contest a state’s termination of a Medicaid agreement would be inconsistent with the Supreme Court’s decision in O’Bannon v. Town Ct. Nursing Ctr., 447 U.S. 773 (1980). Second, as Chief Judge Owen also noted, even without O’Bannon, the qualified-provider provision does not unambiguously provide that a Medicaid patient may contest a State’s determination that a particular provider is not “qualified.” Thus, the preliminary injunction entered in this case must be vacated. I write separately to further explicate why the Supreme Court’s Spending Clause opinions in Gonzaga Univ. v. Doe, 536 U.S. 273 (2002), and Armstrong v. Exceptional Child Ctr., Inc., 575 U.S. 320 (2015) foreclose any contention that the Medicaid Act’s qualified-provider provision confers such a private right. I also provide a third reason why the preliminary injunction must be vacated: even if the qualified-provider provision did confer a private federal right—enforceable through 42 U.S.C. § 1983 —to contest a state’s qualification determination, the plaintiffs’ claims would fail on the merits. I. Congress may prescribe the terms on which it gives federal money to the states, but “it must do so unambiguously.” Pennhurst State Sch. & Hosp. v. Halderman, 451 U.S. 1 , 17 (1981). Spending Clause legislation is “much in the nature of a contract”: the states receive federal funds in exchange for compliance with concomitant conditions. Id. By “insisting that Congress speak with a clear voice,” Pennhurst’s clear-statement rule “enable[s] the States to exercise their choice [to enter that quasi-contract] knowingly, 36  No. 17-50282 cognizant of the consequences of their participation.” Id.; see also Will v. Mich. Dep’t of State Police, 491 U.S. 58 , 65 (1989) (“[I]f Congress intends to alter the ‘usual constitutional balance between the States and the Federal Government,’ it must make its intention to do so ‘unmistakably clear in the language of the statute.’” (quoting Atascadero State Hosp. v. Scanlon, 473 U.S. 234 , 242 (1985))). For a time, the Supreme Court interpreted Pennhurst’s clear-statement rule to mean that statutes create a “‘federal right’ that is enforceable under § 1983” whenever “the provision in question was intend[ed] to benefit the putative plaintiff.” Wilder v. Va. Hosp. Ass’n, 496 U.S. 498 , 509 (1990) (quoting Golden State Transit Corp. v. City of Los Angeles, 493 U.S. 103 , 106 (1989)). In Blessing v. Freestone, the Court distilled that standard into a three-factor inquiry, asking: (1) whether Congress “intended that the provision in question benefit the plaintiff”; (2) whether “the right assertedly protected by the statute is not so ‘vague and amorphous’ that its enforcement would strain judicial competence”; and (3) whether “the provision giving rise to the asserted right [is] couched in mandatory, rather than precatory, terms.” 520 U.S. 329 , 340– 41 (1997). But the Supreme Court has since changed course. In Gonzaga, the Court abandoned the lenient Wilder/Blessing framework, instead requiring “an unambiguously conferred right” to support enforceability through § 1983. 1 1 As the partially dissenting opinion notes, Gonzaga did not expressly state that the Wilder/Blessing framework had been overruled. Nevertheless, the Court explicitly “reject[ed] the notion that [Supreme Court] cases permit anything short of an unambiguously conferred right to support a cause of action brought under § 1983,” and then listed features of statutes that do not confer such a right. Gonzaga, 536 U.S. at 283 . Moreover, Justice Stevens, dissenting in Gonzaga, noted that the majority opinion had adopted a “‘new’ approach to discerning a federal right.” 536 U.S. at 302 (Stevens, J., dissenting). And the Supreme Court’s later decision in Armstrong—the controlling opinion, not just a plurality—made 37  No. 17-50282 Gonzaga, 536 U.S. at 283 ; see also id. (“[I]t is only violations of rights, not laws, which give rise to § 1983 actions.”). In that case, the Supreme Court held that the Federal Education Rights and Privacy Act’s (FERPA) “nondisclosure provision”—which denies federal funding to schools that permit the release of students’ education records without their parents’ written consent—did not “confer enforceable rights.” Id. at 278–79, 289. Instead of evaluating this provision under the three Wilder/Blessing factors, the Court observed that the statute merely told a federal agency when to grant funding and when to withhold it. Id. at 282–83, 289. The nondisclosure provision defined one of many prohibited “polic[ies] or practice[s],” and the statute established that “[n]o [Department of Education] funds shall be made available” to a school that maintained these policies or practices. Id. at 287 (quoting 20 U.S.C. § 1232g(b)(1)). The nondisclosure provision thus had an “aggregate, not individual, focus.” Id. at 290. The provision spoke “only to the Secretary of Education[’s]” transactions with schools wanting federal funding, and was thus “two steps removed” from the students and parents whom the statute ultimately benefitted. Id. at 287. The statute’s references to these benefitted individuals were made only “in the context of describing the type of ‘policy or practice’ that triggers a funding prohibition.” Id. at 288. The Court also recognized that Congress chose tools other than private lawsuits to enforce the statute’s terms. The statute “expressly authorized the Secretary of Education to ‘deal with violations’ of the Act . . . and required the explicit what Gonzaga held implicitly: the Wilder/Blessing framework no longer controls. Armstrong, 575 U.S. at 330 n* (“[The plaintiffs] do not assert a § 1983 action, since our later opinions plainly repudiate the ready implication of a § 1983 action that Wilder exemplified.”). We therefore must follow the Supreme Court’s lead and apply the “‘new’ approach to discerning a federal right” exemplified by Gonzaga and Armstrong. Gonzaga, 536 U.S. at 302 (Stevens, J., dissenting). 38  No. 17-50282 Secretary to ‘establish or designate [a] review board’ for investigating and adjudicating such violations.” Id. at 289 (quoting 20 U.S.C. § 1232g(f)–(g)). Congress thus expressly empowered the executive branch—not the judiciary— to keep schools from disclosing education records without parental consent. The Court also observed that the enforcement mechanism—the withholding of federal funds—was triggered only if a recipient institution “fail[ed] to comply substantially with any requirement” of FERPA. Id. at 279 (emphasis added); see also id. at 288–89. This indicated that the statute was concerned less with the protection of each individual person benefitted by the statute—and therefore did not contemplate enforcement through lawsuits for each individual violation—than it was about general compliance enforced holistically by the Secretary of Education. Id. at 288–89. Hitting even closer to the qualified-provider provision at issue in the instant case, four Supreme Court Justices applied Gonzaga to the Medicaid Act in a plurality opinion in Armstrong. In that case, a provider sued, alleging that the reimbursements it received from the state of Idaho were too low to comply with 42 U.S.C. § 1396a(a)(30)(A), which required Idaho’s Medicaid plan to “assure that payments are consistent with efficiency, economy, and quality of care” while “safeguard[ing] against unnecessary utilization of . . . care and services.” Armstrong, 575 U.S. at 323 (quoting 42 U.S.C. § 1396a(a)(30)(A)). The plurality opined that the provider had no private right of action because 42 U.S.C. § 1396c, like the statute in Gonzaga, merely told a federal agency when to withhold funding and explicitly contemplated that withholding of funding was the statute’s enforcement mechanism. Id. at 331–32 (plurality). Here, just like the statutes in Gonzaga and Armstrong, the qualified- provider provision does not create an “unambiguously conferred right.” Gonzaga, 536 U.S. at 283 ; see also Armstrong, 575 U.S. at 331–32 (plurality). 39  No. 17-50282 As a starting matter, like the provisions at issue in Gonzaga and Armstrong, the qualified-provider provision is “two steps removed” from the individuals that it ultimately benefits, more directly governing the federal government’s interactions with the states. Gonzaga, 536 U.S. at 287 ; see also Armstrong, 575 U.S. at 331–32 (plurality). The clause appears in a long list—the exact same list as the provision in Armstrong—of what “State plan[s] for medical assistance must” have. 42 U.S.C. § 1396a(a). And the statute expressly directs the Secretary of Health and Human Services (HHS) to “approve any plan which fulfills the conditions” set out in that list. 42 U.S.C. § 1396a(b). The provision is thus “phrased as a directive to the federal agency charged with approving state Medicaid plans, not as a conferral of the right to sue upon the beneficiaries of the State’s decision to participate in Medicaid.” Armstrong, 575 U.S. at 331 (plurality); see also Gonzaga, 536 U.S. at 287 . The provision’s references to the individuals whom the statute ultimately benefits are made only in the context of what the states must do to receive federal funding. 2 See Gonzaga, 536 U.S. at 288 . Moreover, just as in Gonzaga and Armstrong, Congress expressly provided for other enforcement mechanisms. Congress gave the Secretary of Health and Human Services the power to withhold federal funds from a state that fails to comply with the codified conditions. 42 U.S.C. § 1396c; Gonzaga, 536 U.S. at 282–83, 289; Armstrong, 575 U.S. at 331–32 (plurality). Congress 2 As Judge Duncan observed at en banc oral argument, the words “individual” and “individuals” are used a total of over 400 times in 42 U.S.C. § 1396a. See Oral Argument at 34:14–34:31. The mere existence of this word, then, can hardly confer an individual right. See Does v. Gillespie, 867 F.3d 1034 , 1042 (8th Cir. 2017) (“The reference to an ‘individual’ is nested within one of eighty-three subsections and is two steps removed from the Act’s focus on which state plans the Secretary ‘shall approve . . . .’” (emphasis omitted) (quoting 42 U.S.C. § 1396a(b))). 40  No. 17-50282 also gave the Secretary the power to promulgate any other rules necessary for the “proper and efficient” operation of a state plan, id. § 1396a(a)(4), and the Secretary has used that authority to require states to give providers the right to appeal their exclusion from the Medicaid program. 42 U.S.C. § 1396a(a)(4)(A); 42 C.F.R. § 1002.213 . The statute thus does not contemplate—either by its express terms or its administrative implementation—enforcement through private-patient lawsuits. Indeed, as Judge Colloton of the Eighth Circuit observed, allowing these lawsuits would create “a curious system for review of a State’s determination that a Medicaid provider is not ‘qualified’” and risk “parallel litigation and inconsistent results.” Does v. Gillespie, 867 F.3d 1034 , 1041–42 (8th Cir. 2017). Furthermore, the qualified-provider provision is part of a “substantial compliance” regime, just like the provisions in Gonzaga and Armstrong. The Medicaid Act directs the Secretary to withhold Medicaid funding from a state only if the Secretary determines that “in the administration of the plan there is a failure to comply substantially” with a provision of the statute. 42 U.S.C. § 1396c(2) (emphasis added). Substantial-compliance regimes like these have an “aggregate focus,” are “not concerned with whether the needs of any particular person have been satisfied,” and thus do not “give rise to individual rights.” Gonzaga, 536 U.S. at 288 (internal quotation marks and citations omitted). Even if Texas unlawfully terminated a qualified provider within the meaning of the qualified-provider provision, 3 it would not necessarily lead to the state’s loss of Medicaid funds. Texas would lose Medicaid funds only if the 3 For the reasons explained in Part II of this concurring opinion, Texas has not done so. 41  No. 17-50282 Secretary determined that this single failure to comply—in tandem with any other unlawful terminations of “qualified” providers—amounted to “substantial[]” noncompliance. 42 U.S.C. § 1396c(2). Converting this substantial-compliance regime, holistically evaluated and enforced by the Secretary, to a system allowing plaintiffs to sue for each and every individual violation would conflict with the statute’s text and structure as well as Supreme Court precedent. And as amici Louisiana and Mississippi point out, it could also have drastic consequences, opening the floodgates of litigation against states that make hundreds of routine Medicaid termination decisions every year. 4 State officials would potentially “not even [be] safe doing nothing” because recognizing a private right to challenge a state’s qualification determinations “may enable Medicaid recipients to challenge the failure to list particular providers, not just the removal of former providers.” Gee v. Planned Parenthood of Gulf Coast, Inc., 139 S. Ct. 408 , 409 (2018) (Thomas, J., dissenting from denial of certiorari). In sum, the qualified-provider provision is “two steps” removed from the patients it ultimately benefits, expressly contemplates other enforcement mechanisms, and is part of a substantial-compliance regime. These same three features prevented the provisions in Gonzaga and Armstrong from creating an “unambiguously conferred right.” They should do the same here. Indeed, the Eighth Circuit, looking at these same three features of the qualified-provider provision, came to this same conclusion. See Gillespie, 867 F.3d at 1046. The plaintiffs’ arguments against this conclusion are unavailing. The plaintiffs, along with the dissenting opinions, state that this case differs from 4Louisiana, for example, asserts in its amicus brief that it took 182 disqualification actions in fiscal year 2017. 42  No. 17-50282 Armstrong because Armstrong was an implied-right-of-action case whereas the instant case arises under § 1983. But the Armstrong plurality expressly considered whether “the Medicaid Act itself” is a “source of a cause of action,” and answered in the negative because the provision in question “lack[ed] the sort of rights-creating language needed to imply a private right of action.” 575 U.S. at 331 (emphasis added) (plurality). The analysis for determining whether Congress “intended to create a federal right” is the same regardless of whether the lawsuit is brought under the statute itself or through § 1983. Gonzaga, 536 U.S. at 283 (emphasis omitted); see also id. at 285–86 (“[W]here the text and structure of a statute provide no indication that Congress intends to create new individual rights, there is no basis for a private suit, whether under § 1983 or under an implied right of action.”). The Armstrong plurality’s persuasive reasoning thus extends into the § 1983 context. See id. at 283 (“[W]e further reject the notion that our implied right of action cases are separate and distinct from our § 1983 cases. To the contrary, our implied right of action cases should guide the determination of whether a statute confers rights enforceable under § 1983.”). The plaintiffs also argue that Gonzaga and Armstrong merely “clarified the application of the first Wilder/Blessing factor: the determination of whether a provision contains individual rights-granting language.” This ignores Armstrong’s recognition—one made by a majority of the Court, not just a plurality—that Gonzaga “plainly repudiate[d]” Wilder. See Armstrong, 575 U.S. at 330 n* (“[The plaintiffs] do not assert a § 1983 action, since our later 43  No. 17-50282 opinions plainly repudiate the ready implication of a § 1983 action that Wilder exemplified.”). 5 The plaintiffs do no better by insisting—in an argument echoed by Judge Higginson’s partially dissenting opinion—that this court recently “recognized Wilder’s vitality” in Legacy Cmty. Health Servs., Inc. v. Smith, 881 F.3d 358 (5th Cir. 2018). Of course, it is the en banc court’s prerogative to overrule any contrary panel decision. See, e.g., Hogue v. Johnson, 131 F.3d 466 , 491 (5th Cir. 1997). Here, however, there is no need. As the partially dissenting opinion properly points out, Gonzaga characterized Wilder as turning on the relevant statute’s “explicit[] conferr[al]” of “specific monetary entitlements upon the plaintiffs.” Gonzaga, 536 U.S. at 280 . Legacy, like Wilder, was a case about specific monetary entitlements. See Legacy, 881 F.3d at 363, 371–72. This case, like Gonzaga, is not. See Gonzaga, 536 U.S. at 288 n.6 (concluding that a provision did not create an enforceable federal right when it was “a far cry from the sort of individualized, concrete monetary entitlement found 5 Tellingly, three of the five circuit courts that have held that the qualified-provider provision creates an enforceable private right to challenge a state’s qualification determination relied on the Wilder/Blessing framework before Armstrong clarified in 2015 that Wilder had been repudiated. See Planned Parenthood Ariz. Inc. v. Betlach, 727 F.3d 960 , 966 (9th Cir. 2013) (relying on the three-factor inquiry set out in Blessing, though never actually citing Wilder itself); Planned Parenthood of Ind. v. Comm’r of Ind. State Dep’t of Health, 699 F.3d 962 , 976 (7th Cir. 2012); Harris v. Olszewski, 442 F.3d 456 , 463 (6th Cir. 2006). Another two circuit courts rely on Wilder even post-Armstrong, which, as explained above, seems to misread the repudiation of Wilder joined by five justices in Armstrong. See Planned Parenthood of Kan. v. Andersen, 882 F.3d 1205 , 1229 (10th Cir. 2018); Planned Parenthood S. Atl. v. Baker, 941 F.3d 687 , 699 (4th Cir. 2019). The Eighth Circuit, by contrast, correctly observed that it is no longer “enough, as Wilder and [Blessing] might have suggested, to show simply that a plaintiff ‘falls within the general zone of interest that the statute is intended to protect.’” Gillespie, 867 F.3d at 1039–40 (quoting Gonzaga, 536 U.S. at 283 ). “In the final analysis, the resolution of this dispute will be determined not by arithmetic, but rather, by the strength and persuasiveness of the several decisions.” New York v. U.S. Dep’t of Justice, 960 F.3d 150 , 153 (2d Cir. 2020) (Cabranes, J., concurring in denial of rehearing en banc). 44  No. 17-50282 enforceable in . . . Wilder”). Thus, even assuming arguendo that vestiges of the Wilder/Blessing framework still remain in certain contexts, the qualified- provider provision’s close similarity to the provisions in Gonzaga and Armstrong—which ultimately did not create private enforceable rights— demonstrates that the qualified-provider provision would not create such a right even within that framework. Finally, the plaintiffs point to 42 U.S.C. § 1320a-2 as evidence that Congress contemplated enforcement of the qualified-provider provision through private lawsuits. Congress enacted this provision in response to the Supreme Court’s decision in Suter v. Artist M., 503 U.S. 347 , 364 (1992), which held that the Adoption Assistance and Child Welfare Act (AACWA) did not contain an implied private right of action or confer a private right enforceable via § 1983. The provision states: In an action brought to enforce a provision of this chapter, such provision is not to be deemed unenforceable because of its inclusion in a section of this chapter requiring a State plan or specifying the required contents of a State plan. This section is not intended to limit or expand the grounds for determining the availability of private actions to enforce State plan requirements other than by overturning any such grounds applied in Suter v. Artist M., 112 S. Ct. 1360 (1992), but not applied in prior Supreme Court decisions respecting such enforceability; provided, however, that this section is not intended to alter the holding in Suter v. Artist M. that section 671(a)(15) of this title is not enforceable in a private right of action. 42 U.S.C. § 1320a-2. Other circuits have observed that this provision is “hardly a model of clarity.” Sanchez v. Johnson, 416 F.3d 1051 , 1057 n.5 (9th Cir. 2005); see also Gillespie, 867 F.3d at 1044. The first sentence “disapproves one portion of Suter: the Court had suggested that when a provision of the [AACWA] required a state plan and specified the mandatory elements of a plan, it required only 45  No. 17-50282 that a State have a plan approved by the Secretary which contained those features, not that the plan actually be in effect.” Gillespie, 867 F.3d at 1044 (citing Suter, 503 U.S. at 358 ). No one in the instant case complains that Texas’s Medicaid plan is not actually in effect. The provision’s second sentence states (vaguely) that the provision’s purpose is narrowly drawn to overturn portions of the Court’s reasoning in Suter and was not intended to limit or expand private rights of action in any other manner—or even to alter the ultimate holding in Suter itself. Indeed, the provision expressly acknowledges that it does not touch any other Supreme Court decisions concerning private rights of action prior to Suter. As the Eighth Circuit noted, the “other points discussed in Suter, including the requirement of unambiguous notice to states about conditions on the receipt of federal funds and the significance of an alternative enforcement mechanism, were relevant considerations before Suter and are beyond the scope of § 1320a-2.” Id. at 1045. Moreover, the provision was adopted well before Gonzaga and Armstrong and did not inform the analysis in either of those cases. Our task is to determine whether the qualified-provider provision unambiguously confers an individual right—enforceable through private- patient lawsuits—to contest a state’s qualification determination. In that endeavor, we are bound by Gonzaga and guided by the Armstrong plurality, and for the reasons explained above, we must conclude that the statute does not. *** The providers in the instant case—by launching a lawsuit brought by their patients instead of going through the appropriate administrative appeals processes—attempt to make “an end run around” the enforcement tools that Congress, HHS, and the state of Texas have chosen. Gee, 139 S. Ct. at 409 46  No. 17-50282 (Thomas, J., dissenting from denial of certiorari) (quoting Planned Parenthood of Gulf Coast, Inc. v. Gee, 876 F.3d 699 , 702 (5th Cir. 2017) (Elrod, J., dissenting from denial of rehearing en banc)). Gonzaga and Armstrong make clear that this attempt must fail. II. The court’s judgment in the instant case is also correct for an additional reason: even assuming that the Supreme Court’s decisions in O’Bannon, Gonzaga, and Armstrong did not apply and private plaintiffs could sue states under the qualified-provider provision, the private plaintiffs in the instant case would fail on the merits of that claim. Judge Jones’s excellent panel opinion correctly identified the appropriate substantive legal standard and the correct standard of judicial review that would apply to these lawsuits, if they could be brought. Under those standards, the Office of Inspector General’s (OIG) decision to terminate Planned Parenthood’s Medicaid agreement would be permissible. See Planned Parenthood of Greater Tex. Family Planning & Preventative Health Servs., Inc. v. Smith, 913 F.3d 551 (5th Cir. 2019), reh’g granted, 914 F.3d 994 (2019). A. To begin, the statute only allows Medicaid patients access to providers who are “qualified.” 42 U.S.C. § 1396a(a)(23)(A). The majority correctly concludes, consistent with O’Bannon, that a provider is qualified if and only if the state has deemed that provider qualified to participate in Medicaid. But even if “qualified” did limit a state’s discretion on what providers may participate in its Medicaid plan, that limit must be, as Judge Jones explained, one that is “an easy standard for the state to meet.” Smith, 913 F.3d at 565. Otherwise, it would be inconsistent with Medicaid regulations that “allow states to set reasonable standards relating to the qualifications” of 47  No. 17-50282 providers. Id. at 563 (quoting 42 C.F.R. § 431.51 (c)(2)). Indeed, the previously prevailing standard in this circuit acknowledged that “states retain broad authority to define provider qualifications and to exclude providers on that basis.” Planned Parenthood of Gulf Coast, Inc. v. Gee, 862 F.3d 445 , 465 (5th Cir. 2017); see also Detgen ex rel. Detgen v. Janek, 752 F.3d 627 , 631 (5th Cir. 2014) (explaining that states possess “broad discretion to implement the Medicaid Act”). Other circuits have interpreted “qualified” more favorably to providers, finding that a state agency errs anytime it terminates the Medicaid agreement of a provider that is simply “capable of performing the needed medical services in a professionally competent, safe, legal, and ethical manner.” See Planned Parenthood of Ind. v. Comm’r of Ind. State Dep’t of Health, 699 F.3d 962 , 978 (7th Cir. 2012). But, as Judge Jones explained, this vague definition is susceptible to more-specific interpretations that would conflict with the Medicaid Act’s text and structure. Smith, 913 F.3d at 564. For starters, being “capable of” something merely denotes “the ability to perform a function.” Id. at 563. The “capable of” definition could be interpreted to allow providers to stay in the Medicaid program as long as they could have operated safely, even if they were not actually doing so. But the use of “qualified” in the statute’s text requires more: “qualified” means “[h]aving qualities or possessing accomplishments which fit one for a certain . . . function” and, often, it means that this fitness is “officially recognized.” Id. at 563–64 (alteration in original) (quoting The Oxford English Dictionary (online ed. 2017)). The appropriate question, then, is not whether a provider has the potential to operate safely, legally, and ethically, but whether it is actually doing so. 48  No. 17-50282 Furthermore, as Judge Jones explained, a “literal understanding” of the “capable of” definition could posit that a provider is “qualified” until the state has totally barred that provider from operating entirely. Id. at 564. But that definition would conflict with the many Medicaid Act provisions that expressly allow states to decertify providers for reasons wholly unrelated to the provider’s license to provide care at all. Id. States can, for example, terminate providers for “excessive charges; fraud, kickbacks, or other prohibited activities; failure to provide information; failure to grant immediate access under specified circumstances; default on loan or scholarship obligations; or false statements or material misrepresentations of fact in certain circumstances.” Gee, 862 F.3d at 477–78 (Owen, J., dissenting) (citing 42 U.S.C. §§ 1396a(p)(1)–(3), 1320a–7, 1395cc(b)(2)); see also Gee, 876 F.3d at 701 (Elrod, J., dissenting from denial of rehearing en banc) (explaining that Medicaid providers may be terminated for reasons that would not require them to shut down completely). This definition of “qualified” would also straitjacket state agencies like the OIG that can decertify a provider from the Medicaid program, but not from practicing in general. See Smith, 913 F.3d at 564; Tex. Occ. Code Ann. §§ 151.003 (2), 152.001(a); 25 Tex. Admin. Code § 139.1 (a). Moreover, Pennhurst’s clear-statement rule permits states to interpret and implement a Spending Clause statute unless the statute “plainly prohibit[s]” that interpretation. Detgen, 752 F.3d at 631. Texas has interpreted “qualified” to mean that the OIG may terminate a Medicaid provider’s agreement when the OIG establishes “by prima facie evidence” that a provider has committed a “program violation”; is “affiliated” with a provider that commits a program violation; or commits “an act for which sanctions, damages, penalties, or liability could be assessed or are assessed by the OIG.” 1 Tex. Admin. Code § 371.1703 (c)(6)–(8). Texas law further provides that those 49  No. 17-50282 sanctions can be imposed when the provider “fails to provide an item or service to a recipient in accordance with accepted medical community standards or standards required by statute, regulation, or contract, including statutes and standards that govern occupations.” Id. § 371.1659(2). Nothing in the Medicaid Act “plainly prohibits” this interpretation. If Congress wanted a more precise definition of “qualified,” it could have said so. But the contract that Congress entered with the states contained no such definition. United States v. Young, 458 F.3d 998 , 1007 (9th Cir. 2006) (O’Scannlain, J.) (“Congress knows how to define terms when it wants to give them specific definitions . . . .”). Because the states have not committed to a federal definition of “qualified,” they have wide latitude in determining who is “qualified” and who is not, so long as they identify a regulation implicating safety, legality, or ethics and rely on substantial evidence showing that the provider violated that regulation. B. Again, even assuming arguendo that the private plaintiffs have an enforceable federal right to challenge the state’s qualification determination, 6 the panel also correctly identified the standard of judicial review under which these claims would be evaluated: the arbitrary-and-capricious standard, limited to the state administrative record. Smith, 913 F.3d at 565. This circuit has consistently applied this standard when reviewing the “substantive adequacy and reasonableness” of a state agency’s determinations in the Medicaid context. Abbeville General Hosp. v. Ramsey, 3 F.3d 797 , 804 (5th Cir. 1993). In Abbeville, we held that the deferential arbitrary-and-capricious standard applied to a state agency’s rate-setting action under the Medicaid 6 And again, they do not. 50  No. 17-50282 Act’s Boren Amendment. Id. at 803 . Under this deferential standard, an agency’s finding may be overturned only if it fails to satisfy “minimum standards of rationality.” La. Envtl. Action Network v. U.S. E.P.A., 382 F.3d 575 , 582 (5th Cir. 2004). Courts may consider only “whether the agency action bears a rational relationship to the statutory purposes and [whether] there [is] substantial evidence in the record to support it.” Id. (quoting Tex. Oil & Gas Ass’n v. U.S. E.P.A., 161 F.3d 923 , 934 (5th Cir. 1998) (internal quotation marks removed)). In determining whether the agency had “substantial evidence” for its action, the reviewing court looks only to the evidentiary record that was before the agency when it made its decision. Luminant Generation Co. v. U.S. E.P.A., 675 F.3d 917 , 925 (5th Cir. 2012). The Abbeville rule is deeply rooted in the longstanding precedent of this court. Smith, 913 F.3d at 566. Abbeville itself recognized that the applicability of this standard to state agency determinations is an “indisputable proposition” supported by a “litany of cases.” Abbeville, 3 F.3d at 802 & n.6 (citing cases); see also Miss. Hosp. Ass’n, Inc. v. Heckler, 701 F.2d 511 , 517 (5th Cir. 1983) (reviewing a state agency’s Medicaid reimbursement plan under the arbitrary- and-capricious standard). Other courts have followed this approach as well. See Smith v. Rasmussen, 249 F.3d 755 , 760 (8th Cir. 2001); Brown v. Day, 434 F. Supp. 2d 1035 , 1041 (D. Kan. 2006); Friedman v. Perales, 668 F. Supp. 216 , 221 (S.D.N.Y. 1987), aff’d, 841 F.2d 47 (2d Cir. 1988). The Abbeville rule is also comity enhancing, consistent with the Medicaid Act’s system of “cooperative federalism.” Harris v. McRae, 448 U.S. 297 , 308 (1980) (quoting King v. Smith, 392 U.S. 309 , 316 (1968)). If HHS—rather than Texas’s OIG—had terminated Planned Parenthood’s Medicaid agreement, the decision would undoubtedly be reviewed under the arbitrary-and-capricious standard. See 5 U.S.C. § 706 (2)(A); see also Honey Grove Nursing Ctr. v. U.S. 51  No. 17-50282 Dep’t of Health & Human Servs., 606 F. App’x 164, 167 (5th Cir. 2015) (reviewing whether the Secretary’s decision imposing sanctions on Medicaid provider was arbitrary and capricious). In a “federal-state cooperative” like Medicaid, it would make little sense to review federal termination decisions at one level of judicial review and state termination decisions at a less deferential level. Smith, 913 F.3d at 567. Especially in light of Pennhurst’s clear- statement rule, we should not infer that Congress intended to relegate states to the position of distrusted, second-class decisionmakers without an express indication in the statute saying as much. The Abbeville standard also incentivizes providers to use the state-level administrative appeal process that the Medicaid Act and its accompanying regulations require. See Smith, 913 F.3d at 568 (describing the arbitrary-and- capricious standard as “a feature—not a bug”). Without arbitrary-and- capricious review limited to the state administrative record, providers would be encouraged to do exactly what they did here—refuse to schedule an informal resolution meeting to address the state’s concerns and refuse to submit evidence and argument to the state agency—knowing full well that they could simply hit the reset button once they got to court. This would render the state’s administrative review processes largely meaningless, further undermining the “federal-state cooperative” that the Medicaid Act contemplates and further constraining the states with limitations that were not clearly stated in the quasi-contract that they entered into with the federal government. C. Even under these standards—which, again, would apply only if the private plaintiffs had an enforceable federal right 7—the OIG did not act 7 Again, they do not. 52  No. 17-50282 arbitrarily or capriciously in evaluating whether Planned Parenthood was “qualified.” In its Final Notice sent to the Planned Parenthood affiliates, the OIG identified a number of “regulations concerning the ‘safe, legal, and ethical manner’ of furnishing healthcare services.” Smith, 913 F.3d at 565. And based on the record before it, the OIG pointed to “substantial evidence” of the provider’s violations of these regulations. Some of those regulations forbid researchers from taking “part in any decisions as to the timing, method, or procedures used to terminate [a] pregnancy made solely for the purposes of the research.” 42 U.S.C. § 289g- 1(c)(4); see also 45 C.F.R. § 46.204 (i). The OIG relied on video footage 8 showing 8 The district court concluded, as PPGC alleged, that “the quality and strength of the evidence [that the video] provides is suspect.” But the plaintiffs entered no evidence into the administrative record or the district court record indicating that this video was deceptively edited or otherwise unreliable. On appeal, the plaintiffs do not identify any evidence in the district court record showing that the videos are unreliable, and they admitted at oral argument that they provided no such evidence. See Oral Argument at 58:50-59:30. Even if courts could consider evidence outside the administrative record—as the district court seemed to believe—the district court erred on this point. The OIG provided the district court with a declaration as to authenticity from the individual who filmed the footage. The OIG also provided the district court with a report from a highly regarded forensic firm concluding that both videos were authentic and not deceptively edited. The district court did not address this evidence and does not identify any evidence in the district court record to the contrary. PPGC’s allegation that the video is unreliable is further undermined by its equivocation on whether it had access to the full video. In their preliminary injunction motion, the plaintiffs said that the OIG’s “justification for termination is especially inadequate when this video—the supposedly unedited version of which the Attorney General has yet to provide to Plaintiffs—is the only ‘evidence’ of wrongdoing defendants can come up with.” That conflicts with the cross-examination of Farrell, in which she admits that PPGC had the full footage “sometime in January of 2016.” The dissenting opinion’s mystifying digression about whether the video was “authenticated” under Federal Rule of Evidence 901 is even further off the mark, which is why no party bothered to brief it. The video’s connection to this case is that it informed the OIG’s disqualification decision—a decision the district court was required to defer to so long as it satisfied “minimum standards of rationality.” La. Envtl. Action Network, 382 F.3d at 582 . It should go without saying that the Federal Rules of Evidence do not apply to Texas state agency decision-making. Whether the video was “authenticated” under the federal 53  No. 17-50282 that Planned Parenthood Gulf Coast (PPGC) has permitted doctors involved in fetal-tissue research to perform abortions to secure that fetal tissue. As just one example, in the video, PPGC Research Director Melissa Farrell mentions a doctor who performed abortions and collected tissue for her own research. Farrell reports that the doctor would pick the abortion patients she wanted based on how beneficial that tissue would be for her own research. The doctor would then collect her own specimens and “take it home with her in her cooler.” The OIG also points to other regulations that expressly forbid the alteration of the timing or method of an abortion for research purposes. See 42 U.S.C. § 289g-1(b)(2)(A)(ii). Many statements in the video support a finding that PPGC doctors had done this. For example, Farrell stated that researchers connected to PPGC have targeted specific fetal tissue in the past and that PPGC is willing to alter the abortion procedures to meet the needs of those researchers. Farrell also remarked that PPGC can get “creative” and alter a procedure to obtain a high volume of intact liver, thymus, and neural tissue. Still other regulations also prohibit the receipt of valuable consideration in exchange for fetal tissue. See 42 U.S.C. § 289g-2(a); Tex. Penal Code Ann. § 48.02 (a)-(b). On the video, Farrell asserted that even though PPGC was “already set up” to do the fetal-tissue procurement, PPGC needed to “work out, you know, something in terms of covering additional costs for additional . . . things related to it.” Farrell discussed how she uses a contract’s language to make it appear that payments are going only to “administrative costs” rather than compensation for specimens, which she admits is “touchy” under federal law. On the video, she says, “I’m very particular about working with the rules during the district court proceedings is irrelevant to whether the video supported the OIG disqualification decision, which—as explained above the line—it clearly did. 54  No. 17-50282 language of the budget and contract to where the language is specific to covering the administrative costs and not necessarily the per specimen. Because that borders on some language in the federal regs, it’s a little touchy.” Farrell also discussed how she creates a profit margin in a budget, even discussing how researchers can buy meals for the staff as a bonus for enrolling patients to donate fetal tissue under the vague category of “meeting cost.” Other regulations prohibit misrepresentations to law-enforcement officials. See, e.g., 1 Tex. Admin. Code § 371.1661 (8). The OIG received evidence from the U.S. House of Representatives Selective Investigation Panel. That evidence documented a visit by the Texas Ranger Division and discussions relating to PPGC’s transactions with a researcher who was interested in obtaining fetal tissue. The U.S. House Panel’s evidence shows that PPGC, at that time, had been informed that the Baylor College of Medicine’s Independent Review Board had approved the researcher’s fetal- tissue research proposal, but PPGC’s General Counsel told the Texas Rangers that approval had not yet been obtained. Texas’s Medicaid rules also allow termination of any entity affiliated with an entity that has committed a program violation. 1 Tex. Admin. Code § 371.1703 (c)(7); id. § 371.1605(a). Federal law expressly allows states to do this. See 42 C.F.R. § 1001.1001 (a)(1)(iii) (States “may exclude an entity . . . if a person with a relationship with such entity . . . [h]as been excluded from participation in Medicare or any State health care program.”). Here, the OIG pointed to significant evidence—both from the video and elsewhere—that Planned Parenthood South Texas (PPST) and Planned Parenthood of Greater Texas (PPGT) were affiliated with PPGC. That evidence showed, for example, that these entities had common identifying information, individual providers that worked across affiliates, common control exercised by Planned 55  No. 17-50282 Parenthood Federation of America, and shared participation in research agreements. 9 Though these entities argue on appeal that this conclusion was unwarranted, they point to no evidence that was before the OIG that undermines the agency’s conclusion. Indeed, these entities did not provide any such evidence to the OIG. Despite admitting that the OIG permissibly disqualified PPGC, the partially dissenting opinion states, without elaboration, that the “legal affiliat[ion]” between PPGC, PPST, and PPGT “ha[s] no bearing on whether PPST or PPGT were qualified.” While it is unclear why even a solely legal relationship between the three entities could be so easily dismissed, the facts recited above show that the entities’ relationship is also functional. It would be difficult to understand under any framework why an entity’s significant overlap in leadership, personnel, and resources with an unqualified entity could be thought to have “no bearing” on that entity’s own qualifications. But the framework applicable here dispels any doubt: the OIG has “broad discretion to implement the Medicaid Act” unless its interpretation is “plainly prohibit[ed]” by “the statutory language.” Detgen, 752 F.3d at 631; see Smith, 913 F.3d at 563 (“[S]tates retain broad authority to define provider 9 In discussing what is required for affiliation, Judge Higginson compares this case to Andersen, 882 F.3d at 1205. That comparison is misplaced. Andersen involved a federal statute that required proof of ownership or control before a Medicaid contract could be terminated. See id. at 1234. Here, Texas relies on a state regulation which permits termination based on “affiliat[ion] with a person who commits a program violation.” 1 Tex. Admin. Code § 371.1703 (c)(6)–(8). Notably, Planned Parenthood calls the provider plaintiffs “affiliates” throughout its own brief and acknowledges that they share membership in the national Planned Parenthood Federation of America which “promulgates medical and other standards to which . . . affiliates . . . must adhere.” Inexplicably, Planned Parenthood asserts just two lines later that the provider plaintiffs are not affiliates. And, as I explain above the line, other “legal and financial ‘functional’ overlaps” showing affiliation were never refuted in the administrative process. 56  No. 17-50282 qualifications and exclude providers on that basis.” (quoting Gee, 862 F.3d at 462)). Unsurprisingly, neither the partially dissenting opinion nor the plaintiffs can point to any provision of the Medicaid Act plainly prohibiting Texas’s affiliate rule—a rule the OIG permissibly applied to PPST and PGGT. The Texas Inspector General reviewed this vast body of evidence thoroughly, considering the U.S. House Panel’s evidence and watching the full eight-hour video five times in addition to reviewing the video’s transcript. 10 The Inspector General also consulted with the OIG’s Chief Medical Officer, who reviewed the video and informed the Inspector General that, in his opinion, the video demonstrated that PPGC violated accepted medical and ethical standards, in violation of Texas’s Medicaid program requirements. 1 Tex. Admin. Code § 371.1659 (2). This entire review process lasted well over a The entire video, which the state divided into 17 parts for ease of transmission, is 10 attached here. Some faces have been blurred due to patient privacy concerns. See Record on Appeal at DX-2; (1) http://www.ca5.uscourts.gov/opinions/pub/17/17-50282- vids/FNND0569_20150409071822-Redacted.mp4; (2) http://www.ca5.uscourts.gov/ opinions/pub/17/17-50282-vids/FNND0569_20150409074648.mp4; (3) http://www.ca5. uscourts.gov/opinions/pub/17/17-50282-vids/FNND0569_20150409081515.mp4; (4) http://www.ca5.uscourts.gov/opinions/pub/17/17-50282-vids/FNND0569_20150409 084341.mp4; (5) http://www.ca5.uscourts.gov/opinions/pub/17/17-50282-vids/FNND0569_ 20150409091208.mp4; (6) http://www.ca5.uscourts.gov/opinions/pub/17/17-50282-vids/ FNND0569_20150409094034.mp4; (7) http://www.ca5.uscourts.gov/opinions/pub/17/17- 50282-vids/FNND0569_20150409100901-Redacted.mp4; (8) http://www.ca5.uscourts.gov/ opinions/pub/17/17-50282-vids/FNND0569_20150409103727.mp4; (9) http://www.ca5. uscourts.gov/opinions/pub/17/17-50282-vids/FNND0569_20150409110553.mp4; (10) http://www.ca5.uscourts.gov/opinions/pub/17/17-50282-vids/FNND0569_20150409 113420.mp4; (11) http://www.ca5.uscourts.gov/opinions/pub/17/17-50282-vids/FNND0569_ 20150409120246.mp4; (12) http://www.ca5.uscourts.gov/opinions/pub/17/17-50282-vids/ FNND0569_20150409123112-Redacted.mp4; (13) http://www.ca5.uscourts.gov/opinions/pub/ 17/17-50282-vids/FNND0569_20150409125940-Redacted.mp4; (14) http://www.ca5.uscourts. gov/opinions/pub/17/17-50282-vids/FNND0569_20150409131657.mp4; (15) http://www.ca5. uscourts.gov/opinions/pub/17/17-50282-vids/FNND0569_20150409134524-Redacted.mp4; (16) http://www.ca5.uscourts.gov/opinions/pub/17/17-50282-vids/FNND0569_20150409 141350.mp4; (17) http://www.ca5.uscourts.gov/opinions/pub/17/17-50282-vids/FNND0569_ 20150409144217.mp4 57  No. 17-50282 year. After this review, the OIG sent a Notice of Termination to the provider plaintiffs, requesting evidence and argument about whether termination was justified. PPGC could have used this opportunity to dispute the validity of the evidence that the agency had received, or to introduce new evidence showing that the OIG’s concerns were unfounded. But PPGC did none of these things; it instead went immediately to the courts. The record before the agency, therefore—the relevant touchstone for our analysis—substantially supported the conclusion that Planned Parenthood had violated state and federal regulations concerning the safe, legal, and ethical furnishing of medical care. On this record, the OIG gave much more than the “minimal consideration to relevant facts contained in the record” that arbitrary-and-capricious review requires. Harris v. United States, 19 F.3d 1090 , 1096 (5th Cir. 1994) (quoting State of Louisiana ex. rel Guste v. Verity, 853 F.2d 322 , 327 (5th Cir. 1988)). *** For the reasons explained both by the court’s opinion and Part I of this concurring opinion, the qualified-provider provision does not confer an enforceable private right to challenge a state’s termination of a Medicaid agreement. But even if it did, the plaintiffs’ claims in the instant case would fail under the appropriate standards that would apply to that action. 11 III. Dissatisfied with the teachings of Gonzaga and Armstrong, Judge Dennis’s dissenting opinion misinterprets the Supreme Court’s rulings in those cases so as to avoid the result their application would have here. The 11Although only the individual plaintiffs’ claims are before the court on this appeal, the analysis in Part II would apply with equal force to the provider plaintiffs’ claims. 58  No. 17-50282 dissenting opinion also includes a lengthy peroration castigating the majority for its purported failure to adhere to precedent. With its remonstrance that stare decisis applies “even in abortion-related cases,” the dissenting opinion implicitly accuses the judges in the majority of reaching a desired result because the provider plaintiffs in this case provide abortions. The reader may decide whether, in a run-of-the-mill implied cause of action dispute, the dissenting opinion would have sua sponte scoured the record to see whether a video entered into the administrative record had been authenticated under Federal Rule of Evidence 901. One might also query whether the opinion would invoke “autonomy,” “freedom of choice,” and the death of “the principles of stare decisis” if this case had involved patients who wanted to stay with a disqualified rheumatologist. The dissenting opinion also takes issue with the fact that the majority opinion overrules panel precedent. 12 Yet our dissenting colleague has not hesitated to vote to overrule circuit precedent in the past based on nothing more than the belief that our precedent was incorrect. For instance, our dissenting colleague did not lament the demise of stare decisis when, twice in the past year, our dissenting colleague voted with the unanimous en banc court to overrule panel precedent. See Williams v. Catoe, 946 F.3d 278 , 281 (5th Cir. 2020) (en banc) (overruling Robbins v. Maggio, 750 F.2d 405 (5th Cir. 1985) and addressing stare decisis in a single sentence “in the event that [it] is a concern”); Green Valley Special Util. Dist. v. City of Schertz, 969 F.3d 460 , 465 (5th Cir. 2020) (en banc) (overruling North Alamo Water Supply Corp. v. City of San Juan, 90 F.3d 910 (5th Cir. 1996) without mentioning stare decisis). 12 It was no secret that the issues addressed in that panel decision were far from settled in this circuit. See Gee, 876 F.3d at 700–02 (Elrod, J., joined by Jolly, Jones, Smith, Clement, Owen, and Southwick, JJ., dissenting from denial of rehearing en banc). 59  No. 17-50282 Indeed, reconsideration of circuit—especially panel—precedent is one of the main purposes of en banc rehearings. See, e.g., United States v. Anderson, 885 F.2d 1248 , 1255 (5th Cir. 1989) (en banc) (Gee & Garwood, JJ.) (noting that “our en banc court [has not] hesitated” to overturn a precedent when “convinced it was a mistaken one”); United States v. Games-Perez, 695 F.3d 1104 , 1124 (10th Cir. 2012) (Gorsuch, J., dissenting from denial of rehearing en banc) (“[I]t is surely uncontroversial to suggest that the point of the en banc process, the very reason for its existence, is to correct grave errors in panel precedents when they become apparent, even if the panel precedents in question happen to be old or involve questions of statutory or regulatory interpretation.”). Contrary to the dissenting opinion’s portrayal, this is not a case about abortion. It is a case about whether patients whose care is paid for under the Medicaid Act can challenge a state’s disqualification of a provider under that Act. In evaluating that question, a majority of this court keeps “the scale of justice even and steady, and not liable to waver with every new judge’s opinion” by taking the Supreme Court’s decisions in O’Bannon, Gonzaga, and Armstrong at their word. June Med. Servs. v. Russo, 140 S. Ct. 2103 , 2134 (2020) (Roberts, C.J., concurring in the judgment) (quoting 1 W. Blackstone, Commentaries on the Laws of England 69 (1765)). It is the dissenting opinion—perhaps because of its insistence on treating this as an abortion issue—that fails to faithfully apply the precedents that would apply in any other case and thereby fails to adhere to our duty to “treat like cases alike.” Id. at 2141 . I therefore join the majority opinion in full. 60  No. 17-50282 JAMES C. HO, Circuit Judge, joined by STUART KYLE DUNCAN, Circuit Judge, concurring: The dissent scolds the majority for “fail[ing] to heed” our “duty [as] judges to adhere to the principles of stare decisis”—principles that “must be respected,” the dissent feels compelled to remind us, “even in abortion-related cases.” Post, at 103–04 (Dennis, J., dissenting). I offer this brief response. I. First, regarding precedent: There is nothing untoward about reconsidering a previous decision of our circuit that turns out to be wrong as a matter of both Supreme Court precedent and statutory text—no matter how “well written” our earlier decision may be. Id. at 104 . “Wrong—but at least well written” is not the legal standard we endeavor to achieve. Revisiting circuit precedent does not signal disrespect for the precedent’s author, but rather respect for the rule of law. Indeed, the ability to reevaluate circuit precedent is precisely why rehearing en banc is available in every circuit in the country. To be sure, people can and do react in different ways when others disagree with them. One option is to be offended. But another is to be thankful. Thankful that, as human beings, judges sometimes make mistakes, but strive to do better. Thankful that our Constitution not only tolerates disagreement, but celebrates it—because we believe in debate, the adversarial process, and issue percolation, both within and across the courts of appeals. Thankful that our legal system affords us the opportunity to make course corrections, because we all agree that it is more important to get the law right than to guard our self-esteem. So I see nothing inappropriate about the majority’s decision today. Nor should the dissent, for that matter. Recall when the shoe was on the other foot 61  No. 17-50282 in Alvarez v. City of Brownsville, 904 F.3d 382 (5th Cir. 2018) (en banc). The dissenters there sought to overturn circuit precedent—with nary a word about the importance of stare decisis. See, e.g., id. at 402 (Dennis, J., dissenting). In response, the majority in Alvarez ultimately disagreed with the dissenters— but not because it was improper to revisit circuit precedent. The majority simply concluded that our precedent was already consistent with the relevant Supreme Court precedents and legal texts. Moreover, a number of us went out of our way to endorse the dissenters’ right to reconsider previous circuit decisions “to better align our precedents” with “conflicting Supreme Court precedent, or (where the Supreme Court has not yet ruled) . . . with the text and original understanding of the Constitution or the plain language of United States statutes.” Id. at 401 (Ho, J., concurring). Yet now the dissent returns the favor by accusing the majority of “fail[ing] to heed” stare decisis—ignoring the fact that the dissenters did precisely the same thing in Alvarez. Post, at 104. II. In addition, the dissent’s admonition that stare decisis applies “even in abortion-related cases” plainly implies that our court is somehow bending the law to disfavor abortion. That is rich, considering how far the federal judiciary has bent over backwards to protect abortion. There is broad consensus that nothing in the text of the Constitution privileges abortion over other health care matters. See, e.g., Jackson Women’s Health Org. v. Dobbs, 945 F.3d 265 , 277 & n.1 (5th Cir. 2019) (Ho, J., concurring in the judgment) (collecting cases). The federal judiciary has nevertheless established abortion as an unenumerated right. See id. And we have dutifully abided by those precedents in case after case. See, e.g., id. at 268 (majority opinion); see also Jackson Women’s Health Org. v. Dobbs, 951 62  No. 17- 50282 F.3d 246 (5th Cir. 2020). What’s more, abortion has been accorded uniquely favorable treatment across a wide range of legal doctrines. See, e.g., Hill v. Colorado, 530 U.S. 703 , 742 (2000) (Scalia, J., dissenting) (“[L]ike the rest of our abortion jurisprudence, today’s decision is in stark contradiction of the constitutional principles we apply in all other contexts.”); June Med. Servs. L.L.C. v. Russo, 140 S. Ct. 2103 , 2171 (2020) (Gorsuch, J., dissenting) (same). 1 So if the judiciary is biased when it comes to abortion, it’s been decidedly in its favor. All of the court’s opinions today are scholarly and rigorous. They analyze the law faithfully, without fear or favor. Members of our court simply disagree over the best reading of the law. That’s fine. It’s why we have multi-member panels. We’re expected to disagree on occasion. And when we do, it should go without saying that we all do so in good faith. But if the dissent is going to charge anyone with selectively invoking legal doctrine in abortion cases, it should ask why it chooses to bring up stare decisis today, but not in cases outside the abortion context like Alvarez. *** The dissent’s stated objective is to uphold the “integrity of the judicial process.” Post, at 104. A worthy goal, to be sure. But following precedent only when you like it—and ignoring it when you don’t—is not judicial integrity. It 1 It’s even been suggested that our court went too far in In re Abbott, 954 F.3d 772 , 778 n.1 (5th Cir. 2020), by effectively equating the unenumerated right to abortion with express rights like the free exercise of religion. See S. Bay United Pentecostal Church v. Newsom, 959 F.3d 938 , 943 n.2 (9th Cir. 2020) (Collins, J., dissenting). I agree that Jacobson v. Massachusetts, 197 U.S. 11 (1905), involved substantive due process—not the Free Exercise Clause—and thus does not set the controlling standard in religious exercise cases. See also Calvary Chapel Dayton Valley v. Sisolak, 140 S. Ct. 2603 , 2608 (2020) (Alito, J., dissenting from denial of application for injunctive relief) (same). That said, Judge Collins’s criticisms helpfully illustrate that our court hardly needs reminding that courts are duty- bound to follow the law, and not to distort it to disfavor abortion. 63  No. 17-50282 is not principled judging. It is the very definition of “WILL instead of JUDGMENT”—stare decisis “only when I say so.” 64  No. 17-50282 STEPHEN A. HIGGINSON, Circuit Judge, joined by STEWART and COSTA, Circuit Judges, concurring in part and dissenting in part, partially joined by DENNIS and GRAVES, Circuit Judges: In O’Bannon v. Town Court Nursing Ctr., 447 U.S. 773 , 785 (1980), the Supreme Court held that Section 23(A) confers on Medicaid recipients a right to receive care from any qualified provider, but not a right to receive care from a decertified provider. In light of O’Bannon, as well as Section 23(A)’s unmistakable focus on Medicaid recipients, I agree with the Fourth, Sixth, Seventh, Ninth, and Tenth Circuits that patients may sue to enforce Section 23(A) under 42 U.S.C. § 1983 . I further agree with these circuits that a provider is “qualified to perform the service or services required” so long as it is “capable of performing the needed medical services in a professionally competent, safe, legal, and ethical manner.” I would therefore find that a Medicaid recipient may sue under § 1983 to continue receiving care from a provider that has been terminated for reasons that are not related to the provider’s medical qualifications. I nevertheless join the en banc majority’s judgment as to Planned Parenthood Gulf Coast (PPGC). 1 Texas’s Health and Human Services Commission’s Inspector General (OIG’s) notice of termination to PPGC set forth multiple concerns related to PPGC’s qualifications under Section 23. OIG alleged, for instance, that PPGC had a “policy of agreeing to procure fetal tissue even if it means altering the timing or method of an abortion” and that PPGC staff violated “minimum standards” in “infection control and barrier precautions with regard to the handling of fetal blood and tissue.” Allegations of this nature, which we must accept at this stage as valid on their face, go to 1 Judges Dennis and Graves do not join this paragraph of the opinion. 65  No. 17-50282 whether PPGC provides Medicaid services in a safe, competent, legal, and ethical manner. O’Bannon does not permit Medicaid beneficiaries to litigate OIG’s professional competency termination of PPGC, when PPGC itself had the opportunity to pursue administrative remedies into state court and potentially into federal court. 2 However, I depart from the judgment as to PPST and PPGT. Texas terminated PPST and PPGT based solely on their “legal affiliat[ion]” with PPGC. To me, that fails to determine that these providers are not qualified; indeed, as the panel majority in the instant case observed, “whether OIG could terminate Medicaid funding for all of the Provider Plaintiffs” based on “regulations authorizing action against ‘affiliates’” is a “separate issue” from whether OIG could terminate Medicaid funding for PPGC itself. Planned Parenthood of Greater Texas Family Planning & Preventative Health Servs., Inc. v. Smith, 913 F.3d 551 , 569 n.18 (5th Cir. 2019), reh’g granted sub nom., Planned Parenthood of Greater Texas Family Planning & Preventative Health Servs. Inc. v. Phillips, 914 F.3d 994 (2020). Texas’s stated basis for termination, its affiliate rule encompassing entities which “share[] any identifying information, including . . . corporate or franchise name,” 3 had no 2 See Planned Parenthood of Gulf Coast, Inc. v. Gee, 862 F.3d 445 , 484 (5th Cir. 2017) (Owen, J., dissenting) (noting that PPGC “may also have a § 1983 claim based on rights under provisions of the Medicaid statutes and regulations (other than § 1396a(a)(23) and regulations promulgated under it)” and finding it “doubtful” that “PPGC is limited to state administrative proceedings and state-court review”). 3 Judge Elrod’s concurring opinion seeks to discern other legal and financial “functional” overlaps not identified by Texas. Indeed, Texas’s only other observation was to speculate about a possible Planned Parenthood Federation of America (PPFA) “national policy.” Notably, neither Texas nor the majority and concurring opinions point to any evidence that specific affiliates had themselves participated in alleged improper conduct. I would hold that the “individual” or “entity” a State may exclude must be the same individual or entity that the State determines is not qualified to provide services. See Planned Parenthood of Kan. v. Andersen, 882 F.3d 1205 , 1235 (10th Cir. 2018) (that “affiliates 66  No. 17-50282 bearing on whether PPST or PPGT were qualified to provide care to Medicaid beneficiaries. See Planned Parenthood S. Atlantic v. Baker, 941 F.3d 687 , 697 n.3, 702, 705 (4th Cir. 2019), petition for cert. filed (U.S. Mar. 27, 2020) (No. 19-1186); see also Planned Parenthood of Kan. v. Andersen, 882 F.3d 1205 , 1227, 1230 & n.17 (10th Cir. 2018) (states’ broad discretion to remove Medicaid providers ties to “qualifications only for professional competency and patient care”); Planned Parenthood Ariz. Inc. v. Betlach, 727 F.3d 960 , 966–68 (9th Cir. 2013). I. Whether Section 23(A) confers a federal right enforceable through § 1983 depends on “whether or not Congress intended to confer individual rights upon a class of beneficiaries.” Gonzaga Univ. v. Doe, 536 U.S. 273 , 285 (2002). In Gonzaga, the Supreme Court clarified that federal spending legislation gives rise to enforceable rights under § 1983 only when the right is “unambiguously conferred” by Congress. Id. at 279–83. Before Gonzaga, the Court had applied a three-factor test to determine whether a statutory provision creates a federal right enforceable through § 1983. Blessing v. Freestone, 520 U.S. 329 , 340 (1997). These three Blessing factors were: First, Congress must have intended that the provision in question benefit the plaintiff. Second, the plaintiff must demonstrate that the right assertedly protected by the statute is not so vague and amorphous that its enforcement would strain judicial competence. Third, the statute must unambiguously impose a binding obligation on the States. In other words, the provision giving rise to the asserted right must be couched in mandatory, rather than precatory, terms. aggregate their finances, share executives, and share legal counsel . . . do[es] nothing to show that PPFA exercises control over its affiliates’ daily operations”). 67  No. 17-50282 Id. at 340–41. Five years later, Gonzaga disavowed lower court decisions that had interpreted Blessing as “allowing plaintiffs to enforce a statute under § 1983 so long as the plaintiff falls within the general zone of interest that the statute is intended to protect.” 536 U.S. at 283 . The Court clarified, For a statute to create such private rights [enforceable under § 1983], its text must be “phrased in terms of the persons benefited.” We have recognized, for example, that Title VI of the Civil Rights Act of 1964 and Title IX of the Education Amendments of 1972 create individual rights because those statutes are phrased “with an unmistakable focus on the benefited class.” Id. (quoting Cannon v. Univ. of Chi., 441 U.S. 677 , 691–92 & n.13 (1979)). Gonzaga, then, recognized that statutory text with an “unmistakable focus on the benefited class” “manifests an unambiguous intent to confer individual rights.” Id. at 280, 284. Taken together, Blessing and Gonzaga instruct that Congressional intent to create an individual right is unambiguous where a statute (1) is phrased with an unmistakable focus on the benefited class, (2) may be enforced without straining judicial competence, and (3) is mandatory on states. “Once a plaintiff demonstrates that a statute confers an individual right, the right is presumptively enforceable by § 1983.” Id. at 284. “The State may rebut this presumption by showing that Congress specifically foreclosed a remedy under § 1983,” for instance, “by creating a comprehensive enforcement scheme that is incompatible with individual enforcement under § 1983.” Id. at 284 n.4 (quoting Blessing, 520 U.S. at 341 ). A. The parties’ dispute over whether Section 23(A) confers an individual right centers on the first Gonzaga/Blessing factor: whether the text of the statute indicates an unmistakable focus on the benefited class. Section 23(A) 68  No. 17-50282 states in relevant part, “A State plan for medical assistance must provide that any individual eligible for medical assistance . . . may obtain such assistance from any institution . . . qualified to perform the service or services required . . . who undertakes to provide him such services.” 42 U.S.C. § 1396a(a)(23)(A). Gonzaga’s teachings do not undermine O’Bannon’s observation that Section 23(A) “gives recipients the right to choose among a range of qualified providers, without government interference.” O’Bannon, 447 U.S. at 785 (first emphasis added). Imagine that Congress had written Section 23(A) without the prefatory phrase, “A State plan for medical assistance must provide that.” This hypothetical version of Section 23(A) might state, “Any individual eligible for medical assistance under a State plan may obtain such assistance from any institution qualified to perform the service required.” Such a provision would unambiguously confer a federal right on Medicaid patients, because it would be indistinguishable from other statutory provisions which the Court has held do create federal rights. The Court has found it “beyond dispute,” for instance, that Section 601 of Title VI contains “‘rights-creating’ language,” because it “decrees that ‘[n]o person . . . shall . . . be subjected to discrimination.’” Alexander v. Sandoval, 532 U.S. 275 , 280, 288 (2001) (quoting 42 U.S.C. § 2000d). Similarly, Section 901(a) of Title IX “expressly identifies the class Congress intended to benefit” by providing, “No person . . . shall, on the basis of sex . . . be subjected to discrimination under any education program or activity receiving Federal financial assistance.” Cannon, 441 U.S. at 690 (citing 20 U.S.C. § 1681 ). Likewise, Wright v. Roanoke Redevelopment and Housing Authority, 479 U.S. 418 , 430 (1987), found “undeniable” Congressional intent to benefit tenants in a rent-ceiling provision of the Public Housing Act stating, 69  No. 17-50282 “A family shall pay as rent for a dwelling unit assisted under this chapter . . . the highest of the following amounts.” Yet the en banc majority finds that Section 23(A) does not confer a federal right on Medicaid patients. The en banc majority concludes that the basic focus of Section 23(A) is shifted away from Medicaid patients and towards state obligations. However, as I read the opening “state plan” phrase, it converges with what the third Gonzaga/Blessing factor requires: it “unambiguously impose[s] a binding obligation on the States.” That a statute directly addresses state obligations does not imply that it fails to confer individual rights; otherwise, the Gonzaga/Blessing framework requiring both an “unmistakable” focus on benefited individuals (factor one) and an “unambiguous” directive to states (factor three) makes little sense. 4 4 In Does v. Gillespie, 867 F.3d 1034 , 1041 (8th Cir. 2017), the Eighth Circuit stated, “Even where a subsidiary provision includes mandatory language that ultimately benefits individuals, a statute phrased as a directive to a federal agency typically does not confer enforceable federal rights on the individuals.” This is faulty for several reasons. First, as further discussed below, Section 23(A) itself is not phrased as a directive to a federal agency. Section 23(A) is phrased as a directive to states, with statutorily separate enforcement provisions of the Medicaid Act imposing duties on the Secretary. Under Blessing, Medicaid’s enforcement scheme goes to whether a state can rebut a presumption of enforceability through § 1983, rather than the threshold issue of whether a right is conferred at all. Second, the Eighth Circuit stated that such statutes “typically” do not confer enforceable rights, yet cited only Universities Research Ass’n, Inc. v. Coutu, 450 U.S. 754 (1981). Coutu does not say that such statutes “typically” fail to confer enforceable rights. Coutu addressed whether a private right of action was implied by a minimum wage provision in the Davis-Bacon Act. As relevant here, the provision stated that certain federal contracts were required to “contain a provision stating the minimum wages to be paid various classes of laborers and mechanics which shall be based upon the wages that will be determined by the Secretary of Labor.” Id. at 756 n.1. The Court concluded narrowly that this language did not create a “private right of action for back wages under a contract that has been administratively determined not to call for Davis-Bacon work,” i.e., a contract not subject to the minimum wage provision. Id. at 756 . The Court expressly declined to resolve “whether the Act creates an implied private right of action to enforce a contract that contains specific Davis-Bacon Act stipulations.” Id. at 768–69. Moreover, Coutu largely focused on whether a private remedy could be inferred, not on whether the provision conferred a private right. See id. at 772–73 (finding the provision’s 70  No. 17-50282 Here, Section 23(A)’s attentiveness to state obligations does not diminish its unmistakable focus on Medicaid patients. Of course, Section 23(A) could have been drafted without such a direct focus on Medicaid patients. Section 23(A) could have been phrased as, “The Secretary shall not approve a State plan for medical assistance absent assurances satisfactory to the Secretary that the plan will reimburse any institution’s provision of services for an individual eligible for assistance, so long as the institution was qualified to perform the services required.” See Cannon, 441 U.S. at 693 (contrasting the actual text of Section 901(a) with an alternative proposal framing Section 901(a) as a “simple directive to the Secretary” prohibiting the Secretary from granting various benefits to institutions absent “assurances satisfactory to the Secretary” that the institution “will not discriminate on the basis of sex”). This alternative version of Section 23(A) arguably would not contain an “unmistakable” focus on individuals. A fair reading of this hypothetical alternative might indicate that Congress drafted the statute to regulate the Secretary’s conduct and with the primary intention of benefiting providers, perhaps with incidental benefits for individuals. But Congress opted for a direct approach. To repeat, Section 23(A) provides, “A State plan for medical assistance must provide that any individual eligible for medical assistance . . . may obtain such assistance from any institution . . . qualified to perform the service or services required . . . who undertakes to provide him such services.” 42 U.S.C. § 1396a(a)(23)(A). This is “language provides no support for the implication of a private remedy” and “less reason to infer a private remedy . . . where Congress . . . has framed the statute simply as . . . a command to a federal agency” (quotations omitted) (emphasis added)). “Plaintiffs suing under § 1983 do not have the burden of showing an intent to create a private remedy because § 1983 generally supplies a remedy for the vindication of rights secured by federal statutes.” Gonzaga, 536 U.S. at 284 . 71  No. 17-50282 not reconcilable with the conclusion that none of the mandatory provisions listed under § 1396a confers federal rights enforceable through § 1983. Such logic gives short shrift to the Court’s long-standing advice that courts and litigants should prudently focus on “specific statutory provision[s]”and conduct “methodical inquir[ies],” rather than address a federal program “as an undifferentiated whole.” Blessing, 520 U.S. at 342–43. I therefore disagree with the en banc majority’s disavowal of Wilder v. Virginia Hospital Ass’n, 496 U.S. 498 (1990), a decision that has been criticized but not clearly overruled, as well as what I believe must be an implicit rejection of our own recent decision in Legacy Community Health Services, Inc. v. Smith, 881 F.3d 358 (5th Cir. 2018). In Legacy, we joined at least five other circuits in concluding that 42 U.S.C. § 1396a(bb) confers enforceable rights on Federally Qualified Health Centers (FQHC’s) because that Medicaid provision “shows the potential ‘rights-creating language’ that Gonzaga calls for.” 881 F.3d at 371. We highlighted § 1396a(bb)(5)(A)’s directive that, “the State plan shall provide for payment to the center or clinic by the State of a supplemental payment,” and § 1396a(bb)(1)’s requirement that “the State plan shall provide for payment for services . . . furnished by a [FQHC] . . . in accordance with the provisions of this subsection.” Id. This language, we found, was “mandatory and has a clear focus on the benefitted FQHCs.” Id. at 372 (quotation omitted). We did not consider the provision’s opening references to state health plans to be evidence that the provision does not focus on benefiting FQHC’s. To the contrary, we held that “[t]he language ‘the State plan shall provide’ is precisely the same language that this court has said is binding [on the States],” relevant to the third Blessing factor, and therefore favored our conclusion that § 1396a(bb) provides enforceable rights. 72  No. 17-50282 Legacy explicitly and correctly declined Texas’s invitation to “overrule cases such as Wilder v. Virginia Hospital Association, 496 U.S. 498 , 512 (1990), in which the Court found other provisions of the Medicaid Act to be enforceable by health care providers through § 1983.” Id. at 372. In Wilder, the Court concluded that a reimbursement provision of the Medicaid Act, the Boren Amendment, created federal rights enforceable through § 1983. The Boren Amendment, like Section 23(A), was codified under 42 U.S.C. § 1396a(a) and therefore “require[d] a state plan to provide for ‘payment . . . of the hospital services, nursing facility services, and services in an intermediate care facility for the mentally retarded provided under the plan.’” Wilder, 496 U.S. at 510 (quoting 42 U.S.C. § 1396a(a)(13)(A) (1982 ed., Supp. V)) (emphases removed). The Court reasoned textually that the Boren Amendment “establishes a system for reimbursement of providers and is phrased in terms benefiting health care providers.” Id. Wilder’s holding, according to Gonzaga, turned on the fact that the Boren Amendment “explicitly conferred specific monetary entitlements upon the plaintiffs . . . requir[ing] States to pay an ‘objective’ monetary entitlement to individual health care providers.” Gonzaga, 536 U.S. at 280 . Our prerogative to overrule, explicitly or implicitly, Legacy does not extend to the authority to declare that Wilder is no longer good law. Texas argues that Wilder itself was implicitly overruled in Gonzaga, then explicitly in Armstrong. I disagree. 5 Gonzaga rejected “the notion that our implied private right of action cases have no bearing on the standards for discerning whether a statute creates rights enforceable by § 1983,” which “Wilder appears 5 I commend the thoughtful, comprehensive discussion of caselaw offered in the Fourth Circuit’s opinion in Planned Parenthood South Atlantic v. Baker, 941 F.3d 687 (4th Cir. 2019). 73  No. 17-50282 to support.” 536 U.S. at 283 (citing Wilder, 496 U.S. at 508–509 n. 9). But at no point did Gonzaga call into question Wilder’s holding that the Boren Amendment conferred an enforceable right on providers. Likewise, the Court made only a passing reference to Wilder in Armstrong Exceptional Child Center, Inc., 135 S. Ct. 1378 (2015), in a concise footnote unrelated to the arguments presented to the Court or the ultimate resolution of that case. In Armstrong, providers of habilitation services argued that they were entitled to higher reimbursement rates under Section 30(A) requiring state Medicaid plans to “provide such methods and procedures relating to the utilization of, and the payment for, care and services available under the plan.” 135 S. Ct. at 1382 (quoting 42 U.S.C. § 1396a(a)(30)(A)). Section 30(A) directed states to “safeguard against unnecessary utilization” and “assure that payments are consistent with efficiency, economy, and quality of care and are sufficient to enlist enough providers.” Id. The provider plaintiffs argued that Section 30(A) could be enforced either through an implied right of action under the Supremacy Clause, or in equity. Id. at 1383–87. A majority held that the Supremacy Clause does not confer a right of action to enforce federal law, and further rejected the providers’ contention that a suit to enforce Section 30(A) could proceed in equity. The providers did not argue that the Medicaid Act itself contained an implied private right of action, or that Section 30(A) was enforceable through § 1983. See id. at 1387. Armstrong’s footnote, relied on by the en banc majority to reject Wilder, stated, “[The providers] do not claim that Wilder establishes precedent for a private cause of action in this case. They do not assert a § 1983 action, since our later opinions plainly repudiate the ready implication of a § 1983 action that Wilder exemplified.” Id. at 1387 n.*. The footnote then cited Gonzaga as “expressly ‘reject[ing] the notion,’ implicit in Wilder, ‘that our cases permit 74  No. 17-50282 anything short of an unambiguously conferred right to support a cause of action brought under § 1983.’” Id. (quoting Gonzaga, 536 U.S. at 283 ). This footnote reaffirms Gonzaga’s holding that a private right must be unambiguously conferred and rejects the inference in Wilder that suggests otherwise. Notably also, the Court disclaimed notions “implicit” to Wilder, not Wilder’s holding. 6 Of course, we owe “serious consideration” to “recent and detailed discussion of the law by a majority of the Supreme Court,” Gearlds v. Entergy Servs., Inc., 709 F.3d 448 , 452 (5th Cir. 2013). Manifestly, the footnote contains no such “detailed discussion” shedding light on whether Wilder’s holding continues to bind lower courts. Finally, not even the Armstrong plurality provides a springboard for our en banc majority to anticipate and disregard current Supreme Court law. A plurality of the Armstrong Court, citing Sandoval, opined that “Section 30(A) lacks the sort of rights-creating language needed to imply a private right of action. It is phrased as a directive to the federal agency charged with approving state Medicaid plans, not as a conferral of the right to sue upon the beneficiaries of the State’s decision to participate in Medicaid.” Armstrong, 135 S. Ct. at 1387 (plurality op.). These observations do not imply that Section 23(A) fails to create an enforceable right. First, the plurality’s statement that Section 30(A) is “phrased as a directive to the federal agency charged with approving state Medicaid plans” needs careful explication. As a textual matter, the provision is phrased as a directive to states—not as a directive to the Secretary of Health and Human 6 Thus, in Gee, the United States took the position that “Armstrong was not a Section 1983 case, and it did not purport to alter the framework established by Gonzaga University for determining whether a provision of Spending Clause legislation may be enforced in a Section 1983 action.” Brief for United States as Amicus Curiae at 8, Planned Parenthood v. Gee, 862 F.3d 445 (5th Cir. 2017) (No. 15-30987), 2016 WL 691347 . 75  No. 17-50282 Services. A separate enforcement provision of the Medicaid Act “says that the ‘Secretary shall approve any plan which fulfills the conditions specified in subsection (a),’ the subsection that includes § 30(A).” Armstrong, 135 S. Ct. at 1387 (plurality op.) (quoting 42 U.S.C. § 1396a(b)). The Act’s textually separate enforcement provisions go to whether the State can rebut a presumption of enforceability under § 1983—not to the threshold question of whether a right is conferred by the specific provision in question. Second, the plurality discussion focused on whether Section 30(A) creates a private right of action, not whether Section 30(A) confers a federal right enforceable through § 1983. See, e.g., Armstrong, 135 S. Ct. at 1387 (plurality op.) (opining that Section 30(A) is not “phrased . . . as a conferral of the right to sue” and that its language “reveals no congressional intent to create a private right of action”) (emphases added). “[W]hether a statutory violation may be enforced through § 1983 is a different inquiry than that involved in determining whether a private right of action can be implied from a particular statute. . . . Plaintiffs suing under § 1983 do not have the burden of showing an intent to create a private remedy because § 1983 generally supplies a remedy for the vindication of rights secured by federal statutes.” Gonzaga, 536 U.S. at 283–84. Third, the Armstrong plurality dismissed the possibility of an implied right of action for providers because, in its view, providers are likely “mere incidental beneficiaries [] of the Medicaid agreement, which was concluded for the benefit of the infirm whom the providers were to serve.” 135 S. Ct. at 1387 . Thus, the Armstrong plurality would not necessarily disagree that portions of the Medicaid Act do confer rights on individual patients. 76  No. 17-50282 B. I would also reaffirm precedent that the right conferred by Section 23(A) is enforceable through § 1983. “When the remedial devices provided in a particular Act are sufficiently comprehensive, they may suffice to demonstrate congressional intent to preclude the remedy of suits under § 1983.” Middlesex Cty. Sewerage Auth. v. Nat’l Sea Clammers Ass’n, 453 U.S. 1 , 20 (1981). As the Supreme Court has cautioned, “Only twice have we found a remedial scheme sufficiently comprehensive to supplant § 1983: in Sea Clammers, and Smith v. Robinson, 468 U.S. 992 (1984).” Blessing, 520 U.S. at 347 (citation omitted). Here, the Secretary of HHS is authorized to curtail Medicaid funding to a state that violates Section 23(A). See 42 U.S.C. § 1316 ; 42 U.S.C. § 1396c. Texas contends that this remedial scheme is comparable to the ones discussed in Sea Clammers and Robinson and is sufficiently comprehensive to supplant § 1983. Texas’s argument contradicts the Court’s repeated, commonsense holdings that enforcement schemes based primarily on agency withholding of federal funds fail to displace § 1983. In Sea Clammers, the Court found that the Federal Water Pollution Control Act (FWPCA) and Marine Protection, Research, and Sanctuaries Act (MPRSA) contained “unusually elaborate enforcement provisions” conferring authority to sue to “both on government officials and private citizens.” 453 U.S. at 13 . The private citizens suing in Clammers instead sought to proceed through § 1983, thereby failing to “comply with specified procedures . . . including in most cases 60 days’ prior notice to potential defendants.” Id. at 14. Emphasizing that Congress had “set[] out expressly the manner in which private citizens can seek to enjoin violations,” the Court found it “hard to believe that Congress intended to preserve the § 1983 right of action when it 77  No. 17-50282 created so many specific statutory remedies, including the two citizen-suit provisions.” Id. at 20. In Robinson, the Court concluded that the Education of the Handicapped Act (EHA) provided “an elaborate procedural mechanism to protect the rights of handicapped children,” including a right to “judicial review of the States’ provision of ‘free appropriate public education’ to handicapped children.” Robinson, 468 U.S. at 1010 , 1022 (citing 20 U.S.C. § 1415 ). “Allowing a plaintiff to circumvent the EHA administrative remedies would be inconsistent with Congress’ carefully tailored scheme.” Id. at 1012 . Unlike the FWPCA and MPRSA, the Medicaid Act lacks statutory remedies for individual patients. And unlike the EHA, the Medicaid Act contains no elaborate procedural mechanisms assuring an individual patient’s right to receive care from any qualified provider. Planned Parenthood S. Atlantic, 941 F.3d at 698. As Texas notes, the Medicaid Act requires states to adopt state administrative remedies through which providers may challenge termination decisions. Although the Medicaid Act does require states to provide administrative remedies for “any individual whose claim for medical assistance under the plan is denied,” 42 U.S.C. § 1396a(a)(3), Texas has never argued that it is required to (or that it does) provide administrative remedies for individuals alleging violations of Section 30(A). Rather, federal enforcement of Medicaid relies solely on the Secretary’s ability to withhold funds for violations of the Act. But this sort of enforcement mechanism has never been found to indicate a Congressional intent to displace suit through § 1983. Wright, for instance, held that the Department of Housing and Urban Development’s “generalized powers” to audit and to cut off funds to public housing authorities were not “remedial mechanisms . . . sufficiently comprehensive and effective to raise a clear inference that Congress intended 78  No. 17-50282 to foreclose a § 1983 cause of action for the enforcement of tenants’ rights secured by federal law.” Wright, 479 U.S. at 424–25. The Court also acknowledged as much in Suter v. Artist M., 503 U.S. 347 , 360 (1992). There, the Court ruled that children beneficiaries of the Adoption Assistance and Child Welfare Act could not sue under § 1983 to enforce certain provisions of the Act. The Court emphasized that the Act did provide some safeguards for children by allowing the Secretary of HHS to reduce or eliminate payments to states failing to comply with the Act’s requirements. The Court stressed, however, that such safeguards “may not provide a comprehensive enforcement mechanism so as to manifest Congress’ intent to foreclose remedies under § 1983.” 503 U.S. at 360 . In Blessing, too, the Court again “stressed that a plaintiff’s ability to invoke § 1983 cannot be defeated simply by ‘[t]he availability of administrative mechanisms to protect the plaintiff's interests.’” 520 U.S. at 347 (quoting Golden State Transit Corp. v. City of Los Angeles, 493 U.S. 103 , 106 (1989)). At issue in Blessing was the Aid to Families with Dependent Children (AFDC) program, “which provides subsistence welfare benefits to needy families. To qualify for federal AFDC funds, the State must certify that it will operate a child support enforcement program that conforms with the numerous requirements set forth in Title IV–D of the Social Security Act . . . pursuant to a detailed plan that has been approved by the Secretary of Health and Human Services (Secretary).” Id. at 333. The plaintiffs in Blessing sought a “broad injunction” under § 1983 requiring Arizona to achieve “substantial compliance . . . throughout all programmatic operations.” Id. at 341. Although the Court found that the plaintiffs had failed to state “analytically” “manageable” claims, the Court expressly rejected Arizona’s proposal that Title IV–D’s remedial scheme was sufficiently comprehensive to preclude suit under 79  No. 17-50282 § 1983. The Court noted that “Title IV–D contains no private remedy—either judicial or administrative—through which aggrieved persons can seek redress,” and “[t]he only way that Title IV–D assures that States live up to their child support plans is through the Secretary’s oversight.” Id. at 347. “These limited powers to audit and cut federal funding . . . are not comprehensive enough to close the door on § 1983 liability.” Id. at 348. *** The Supreme Court held in O’Bannon that Section 23(A) “gives recipients the right to choose among a range of qualified providers, without government interference. By implication, it also confers an absolute right to be free from government interference with the choice to remain in a home that continues to be qualified.” 447 U.S. at 785 (second emphasis added). A qualified provider that is terminated for reasons unrelated to its qualifications “continues to be qualified.” In keeping with O’Bannon, and Section 23(A)’s unmistakable textual focus on Medicaid patients, I would allow the individual plaintiffs to proceed with their claims as to PPST and PPGT. I therefore would affirm in part and reverse in part. 80  No. 17-50282 JAMES L. DENNIS, Circuit Judge, joined by JAMES E. GRAVES, Circuit Judge, dissenting: The individual Medicaid patient plaintiffs in this case allege that the state terminated their health care providers from the Medicaid program under the pretext that the providers were “unqualified,” when in fact the providers remain both qualified and willing to provide services to their Medicaid patients. Plaintiffs brought a § 1983 action on the grounds that the state’s wrongful action deprived them of their federal statutory right, secured by the Medicaid Act, 42 U.S.C. § 1396a(a)(23)(A), to choose their own qualified and willing health care provider without unlawful state interference. The district court determined that plaintiffs had shown a strong likelihood of success on the merits and granted a preliminary injunction preventing the state from unlawfully interfering with the patients’ rights. The state appealed, and a panel of this court affirmed in part, vacated in part, and remanded. En banc rehearing was granted. In my view, however, the en banc majority egregiously compounds the panel’s error. Without reaching the merits of the district court’s decision, the en banc majority erroneously overrules circuit precedent and misconstrues three Supreme Court decisions to hold that Medicaid patients never had a federal statutory right secured by the Medicaid Act to choose their own qualified and willing providers or to bring an action under § 1983 to enjoin a state’s unlawful interference with, and deprivation of, that federal statutory right. For the reasons hereinafter assigned, I dissent. The majority’s misinterpretations of the Medicaid Act and three Supreme Court cases—O’Bannon v. Town Court Nursing Center, 447 U.S. 773 (1980); Suter v. Artist M., 503 U.S. 347 (1992); and Armstrong v. Exceptional Child Center, Inc., 575 U.S. 320 (2015)—its overruling of our circuit precedent, 81  No. 17-50282 Planned Parenthood Gulf Coast v. Gee, 862 F.3d 445 (5th Cir.2017), cert denied, 139 S. Ct. 408 (2018) (hereafter “Gee”), and its recalcitrance toward the persuasive view of the majority of other circuits discussed herein leave more than 6.7 million Medicaid recipients in Texas, Louisiana, and Mississippi vulnerable to unlawful state interference with their choice of health care providers. 1 Under the majority’s decision, Medicaid patients will lose any semblance of autonomy in choosing their health care providers and must meekly accept what choices the state allows. I. The Medicaid Act’s free-choice-of-provider provision states that “[a] State plan for medical assistance must . . . provide that any individual eligible for medical assistance (including drugs) may obtain such assistance from any institution, agency, community pharmacy, or person, qualified to perform the service or services required . . . who undertakes to provide him such services[.]” 42 U.S.C. § 1396a(a)(23)(A) (emphases added). Up until the majority’s volte-face today, this court was part of a six-to- one circuit majority holding that the free-choice-of-provider provision confers on each Medicaid recipient an individual right to choose qualified and willing health care providers and the ability to bring suit under § 1983 to challenge unlawful state interference with that right. See Gee, 862 F.3d 445 ; Planned Parenthood S. Atl. v. Baker, 941 F.3d 687 (4th Cir. 2019), cert. denied sub nom., Baker v. Planned Parenthood, --- S. Ct. ---, 2020 WL 6037212 (Oct. 13, 2020); Planned Parenthood of Kan. v. Andersen, 882 F.3d 1205 (10th Cir.), cert. denied sub nom. Andersen v. Planned Parenthood of Kan. & Mid-Mo., 139 S. Ct. 638 1 Centers for Medicare & Medicaid Services, “July 2020 Medicaid & CHIP Enrollment.” https://www.medicaid.gov/medicaid/program-information/medicaid-and-chip- enrollment-data/report-highlights/index.html. 82  No. 17-50282 (2018); Planned Parenthood Ariz. Inc. v. Betlach, 727 F.3d 960 (9th Cir. 2013); Planned Parenthood of Ind., Inc. v. Comm’r of Ind. State Dep’t of Health, 699 F.3d 962 (7th Cir. 2012); Harris v. Olszewski, 442 F.3d 456 (6th Cir. 2006). Only the Eighth Circuit had arrived at a contrary decision. Does v. Gillespie, 867 F.3d 1034 (8th Cir. 2017) (holding Medicaid recipients do not have an enforceable federal right to choose their qualified, willing medical providers). Under the three-step test articulated by the Supreme Court in Blessing v. Freestone, 520 U.S. 329 (1997), to determine whether a statutory provision can be enforced under § 1983: (1) “Congress must have intended that the provision in question benefit the plaintiff”; (2) “the plaintiff must demonstrate that the right assertedly protected by the statute is not so vague and amorphous that its enforcement would strain judicial competence”; and (3) “the statute must unambiguously impose a binding obligation on the States.” Id. at 340–41 (citations and internal quotation marks omitted). In Gonzaga University v. Doe, the Supreme Court further clarified the first Blessing factor, stating that only “an unambiguously conferred right” is enforceable through § 1983. 536 U.S. 273 , 283 (2002); see S.D. ex. rel. Dickson v. Hood, 391 F.3d 581 , 602 (5th Cir. 2004) (“In Gonzaga University v. Doe, the Supreme Court noted that some courts had misinterpreted the first Blessing factor as permitting a § 1983 action whenever the plaintiff fell within the general zone of interests protected by the statute at issue. The Court clarified that nothing short of an unambiguously conferred right can support a cause of action under § 1983.”) (cite omitted) (emphasis in original). Section 1396a(a)(23) satisfies the requisites of the Blessing-Gonzaga framework, as previously held by this court and the majority of federal courts of appeals to consider the question. First, in guaranteeing the free choice of provider to “any individual eligible for medical assistance,” § 1396a(a)(23) employs “the kind of 83  No. 17-50282 ‘individually focused terminology’ that ‘unambiguously confers’ an ‘individual entitlement’ under the law” as required by Gonzaga. Harris, 442 F.3d at 461 (alteration omitted) (quoting Gonzaga, 536 U.S. at 283, 287 ); see also Andersen, 882 F.3d at 1225–27; Betlach, 727 F.3d at 966–67; Planned Parenthood of Ind., 699 F.3d at 974. “The provision has an ‘unmistakable focus’ on its intended class of beneficiaries: ‘any individual eligible for medical assistance’ under the Medicaid Act.” Baker, 941 F.3d at 697 (quoting Gonzaga, 536 U.S. at 284 ) (citation omitted). “Congress’s use of the phrase ‘any individual’ is a prime example of the kind of ‘rights-creating’ language required to confer a personal right on a discrete class of persons—here, Medicaid beneficiaries.” Id. (citing Alexander v. Sandoval, 532 U.S. 275 , 288 (2001)). Second, the free-choice-of-provider right is not so “‘vague and amorphous’ that its enforcement would strain judicial competence.” Andersen, 882 F.3d at 1226 (quoting Blessing, 520 U.S. at 340–41). Plaintiffs need only show that their preferred provider is (1) qualified to perform medical services and (2) undertakes to do so. “These requirements are ‘concrete and objective standards for enforcement, which are well within judicial competence to apply.’” Id. at 1227 (quoting Gee, 862 F.3d at 459); see also Betlach, 727 F.3d at 967 (“[W]hether the doctor is qualified . . . may require . . . factual development or expert input, but still falls well within the range of judicial competence. The requirement could be established, for example, by a combination of evidence as to the medical licenses the doctor holds and evidence as to the licenses necessary under state law to perform family planning services.”); Harris, 442 F.3d at 462 (same); Baker, 941 F.3d at 697 (same); Planned Parenthood of Ind., 699 F.3d at 974 (same). Indeed, courts routinely judge the qualifications of experts in a myriad of different fields when choosing whether to admit expert testimony. See, e.g. FED. R. EVID. 702. 84  No. 17-50282 Third, the free-choice-of-provider provision is “couched in mandatory, rather than precatory” language—a state “must” provide recipients the freedom of choice. Harris, 442 F.3d at 462 (quoting Blessing, 520 U.S. at 341 ); see also Baker, 941 F.3d at 697–98; Andersen, 882 F.3d at 1227–28; Betlach, 727 F.3d at 967; Planned Parenthood of Ind., 699 F.3d at 974. “Once a plaintiff demonstrates that a statute confers an individual right, the right is presumptively enforceable by § 1983.” Gonzaga, 536 U.S. at 284 . Congress may foreclose a remedy under § 1983 “expressly, by forbidding recourse to § 1983 in the statute itself, or impliedly, by creating a comprehensive enforcement scheme that is incompatible with individual enforcement under § 1983.” Blessing, 520 U.S. at 341 . Again, the clear majority of the courts of appeals to decide this question with respect to § 1396a(a)(23) have found no such bar to suit. See Betlach, 727 F.3d at 968 (“Arizona makes no attempt to demonstrate that Congress has expressly or impliedly foreclosed § 1983 remedies for this right, nor would any such attempt succeed.”); Baker, 941 F.3d at 698–700 (same); Andersen, 882 F.3d at 1228–29 (same); Planned Parenthood of Ind., 699 F.3d at 974–75 (same); Harris, 442 F.3d at 462–63 (same). The Medicaid Act does not expressly foreclose a private remedy, and the Supreme Court has explicitly held that Congress did not impliedly foreclose a private remedy under § 1983 merely by creating an additional enforcement mechanism in the Medicaid Act—withholding of federal funds by the Secretary of the federal Department of Health and Human Services—as that enforcement mechanism is not a comprehensive scheme. See Wilder v. Virginia Hosp. Ass’n, 496 U.S. 498 , 521–22 (1990); see also Anderson, 882 F.3d at 1229 n.16; Baker, 941 F.3d at 699–70 (“[T]he Supreme Court has already held that the Medicaid Act's administrative scheme is not sufficiently 85  No. 17-50282 comprehensive to foreclose a private right of action enforceable under § 1983.” (citation omitted)). I am persuaded that the remarkably consistent holdings of five of our sister circuits—and of our court just three years ago in Gee—are correct and firmly rooted in relevant Supreme Court precedents. The current en banc majority errs in abandoning those teachings today by denying patients the ability to enforce their statutorily conferred individual right to choose their qualified and willing health care provider by challenging state interference with that right in a § 1983 action. II. The majority’s opinion relies heavily on a misinterpretation of the Supreme Court’s decision in O’Bannon, 447 U.S. at 773 , to support its strained reading of the Medicaid Act. The majority labels its readings of the Medicaid Act and O’Bannon as “independent bases” for its holding, perhaps in hope of glossing over the fact that O’Bannon refutes the majority’s reasoning. In truth, O’Bannon clearly affirms Medicaid recipients’ right to choose their qualified, willing providers free from unlawful government interference. In O’Bannon, the federal Department of Health, Education, and Welfare decertified a nursing home following a survey of the facility. Three days later, the Pennsylvania Department of Public Welfare notified the nursing home that its Medicaid provider agreement would not be renewed because of the federal decertification. O’Bannon, 447 U.S. at 775–77. The nursing home’s residents brought suit in federal court contending that they were entitled under constitutional due process to an evidentiary hearing before decertification of the nursing home forced their transfer to a different facility. Id. The Supreme Court disagreed. The Court held that nursing home residents’ having to move after decertification of a facility was “an indirect and incidental result of the 86  No. 17-50282 Government’s enforcement” of minimum standards of care that did “not amount to a deprivation of any interest in life, liberty, or property.” 2 Id. at 787 . But there is an overarching feature that distinguishes O’Bannon from the present case and therefore undermines the majority’s reliance on it: the nature of the claim asserted. The nursing home residents in O’Bannon did not bring a § 1983 action based on a theory that the state violated their federal statutory rights by decertifying the nursing home. Rather, they unsuccessfully sought to assert a novel constitutional due process right, arguing they were constitutionally entitled to a pretermination hearing before the facility was decertified because (1) they had a property right in continued residence in the nursing home absent good cause for transfer and therefore were entitled to a hearing on whether cause existed, and (2) transfer would cause them severe physical or emotional pain, which constituted a deprivation of life or liberty and thus also necessitated a hearing. Id. at 784. By contrast, the Medicaid patients in the present case do not rely on novel constitutional theories and instead simply assert the rights granted to them by the Medicaid Act. See Baker, 941 F.3d at 704 (“[T]he patients [in O’Bannon] did not bring a substantive claim seeking to vindicate their rights under the free-choice-of- 2 The Court further explained that “[the] simple distinction between government action that directly affects a citizen’s legal rights, or imposes a direct restraint on his liberty, and action that is directed against a third party and affects the citizen only indirectly or incidentally, provides a sufficient answer to all of the cases on which the [nursing home residents] rel[ied].” O’Bannon, 447 U.S. at 788 . Thus, the Court distinguished Memphis Light, Gas & Water Division v. Craft, 436 U.S. 1 (1978), Perry v. Sindermann, 408 U.S. 593 (1972), and Arnett v. Kennedy, 416 U.S. 134 (1974), cases in which the Court was concerned with the direct action by a public utility toward its customers or by a public employer towards its employees. Id. at 788 & n.21. 87  No. 17-50282 provider provision, but rather sued for violation of their procedural due process rights.”). There is a second difference, noted by Judge Wiener in Gee, that distinguishes O’Bannon from a case like the present one. See 862 F.3d at 460– 61. In O’Bannon, the nursing home facility was decertified, and subsequently its Medicaid agreement was terminated, yet the residents claimed they had a property right to stay in the facility. O’Bannon, 447 U.S. at 775–77. Conversely, in the present case, the state is not seeking to revoke the family planning providers’ licenses and prevent them from serving all patients in the general population, including Medicaid patients. See Gee, 862 F.3d at 461. Rather, the state is terminating the providers’ Medicaid agreements, thereby preventing the providers from treating Medicaid patients. If the providers in actuality remain qualified and willing to provide services to Medicaid patients, as the plaintiffs allege, then the state’s deprivation of Medicaid patients of their services is exactly the type of discriminatory treatment that the free- choice-of-provider right is meant to protect against. 3 Significantly, the Court in O’Bannon expressly distinguished that case from one, like the instant matter, in which Medicaid recipients contend the state unlawfully interfered with their statutory right to choose their qualified, willing providers. O’Bannon stated: “[The free-choice-of-provider provision] 3 This is not to suggest that the only way that a health care provider can be lawfully terminated or excluded from the Medicaid program is to have its license revoked such that it can no longer treat patients in the general population. See Maj. Op. at 27-28. Rather, I note this difference to emphasize how the nature of the right asserted in O’Bannon and the present case differ: The O’Bannon plaintiffs claimed a constitutional property right to stay in the nursing home; the plaintiffs in the current case claim a statutory right to choose among qualified and willing providers. When a state terminates a provider from the Medicaid program for alleged medical and ethical violations, but nonetheless the provider retains its license and continues to treat non-Medicaid patients, this is potentially some evidence that Medicaid patients’ free-choice-of-provider right may have been violated. 88  No. 17-50282 gives recipients the right to choose among a range of qualified providers, without government interference. By implication, it also confers an absolute right to be free from government interference with the choice to remain in a home that continues to be qualified.” Id. at 785 (emphasis omitted). Thus, the current en banc majority has made an unfortunate choice in citing O’Bannon as a basis for its position because O’Bannon plainly recognizes the vitality of the very right that the majority undercuts. Although O’Bannon dealt with recipients’ choice of a nursing home services provider rather than their choice of a family planning services provider, the applicable principles under the Medicaid Act remain the same. O’Bannon does not detract from but strongly reinforces Medicaid recipients’ rights to bring an action for declaratory and injunctive relief against a state for unlawfully interfering with their statutorily conferred freedom of choice as to qualified, willing providers. The en banc majority makes much of language in O’Bannon that patients do not have a right “to enter an unqualified home and demand a hearing to certify it, nor . . . to continue to receive benefits for care in a home that has been decertified.” Id. But the majority overreaches in twisting the Court’s uncontroversial observations that patients lack a right to receive care from an unqualified provider into the conclusion that a patient cannot bring a § 1983 suit when a state unlawfully terminates a qualified and willing provider’s Medicaid agreement. In wrongfully terminating a Medicaid provider agreement under the guise of declaring the provider “unqualified” when in fact the provider remains licensed and qualified to provide the services at issue, the state obviously interferes with plaintiffs’ free choice of provider, which O’Bannon plainly disallows. See id. Judge Wiener, writing in Gee, was certainly correct that “[r]eading O'Bannon to foreclose every recipient's right to challenge a disqualification decision would render the right guaranteed by 89  No. 17-50282 § 1396a(a)(23) nugatory.” 862 F.3d at 460; see also Planned Parenthood Se., Inc. v. Bentley, 141 F. Supp. 3d 1207 , 1218 n.7 (M.D. Ala. 2015) (“[O’Bannon] does not stand for the proposition that any time a State terminates a Medicaid provider agreement, for any reason or for no reason at all, that decision is insulated from substantive review at the behest of recipients.”). Indeed, the majority’s reading of O’Bannon will allow for more state interference directed against providers, thereby abrogating “[t]he right to choose among a range of qualified providers, without government interference,” which was explicitly recognized by the Supreme Court. 447 U.S. at 785 . Contrary to the majority’s claim, O’Bannon does not mandate today’s holding. The nursing-home residents in O’Bannon did not argue that the decertification of the home was an unlawful interference by the state with their free choice of nursing home providers under the Medicaid Act; they claimed they had a property right to stay in the nursing home. See id. at 775–77. By contrast, the patients in the present case make precisely the claim that the state’s termination of their providers’ Medicaid agreements is a violation of their free-choice-of-provider rights because the providers in fact remain qualified. For these reasons, the majority errs in characterizing O’Bannon as supporting its U-turn abrogating Medicaid patients’ right to choose among qualified, willing providers under § 1396a(a)(23) of the Medicaid Act and their corresponding right to bring an action under § 1983 to prevent unlawful state interference with that right. III. The en banc majority attempts to bolster its unduly restrictive and peculiar interpretation of the free-choice-of-provider provision by relying on two other Supreme Court cases, Armstrong v. Exceptional Child Center, Inc., 575 U.S. 320 (2015), and Suter v. Artist M., 503 U.S. 347 (1992). But neither 90  No. 17-50282 Armstrong nor Suter dealt with Medicaid patients’ rights, nor do these cases cast any doubt on the well-reasoned principles elucidated by this court in Gee and by the five other circuits upholding Medicaid patients’ right to bring suit under § 1983 to challenge unlawful state interference with their choice of qualified and willing providers. A. The majority’s premise that Armstrong somehow weakens or otherwise affects the precedents upholding the enforceability of Medicaid patients’ federal statutory rights is totally without foundation. Armstrong was an action by Medicaid providers against a state seeking increased reimbursement rates under § 1396a(a)(30)(A) (the “equal access” provision), and it has little or nothing to do with Medicaid patients’ freedom to choose qualified, willing providers under § 1396a(a)(23), relevant here. See 575 U.S. at 323–24. 4 Armstrong announced no new precedent relevant to the present case, and the provider reimbursement provision at issue in Armstrong is thoroughly distinguishable from the patients’ free-choice-of-provider provision. The equal access provision requires state Medicaid plans to “provide such methods and procedures relating to the utilization of, and the payment for, care and services . . . as may be necessary to safeguard against unnecessary utilization of such care and services and to assure that payments are consistent with efficiency, economy, and quality of care and are sufficient to enlist enough providers so that care and services are available under the plan at least to the extent that such care and services are available to the general population in the geographic area.” Armstrong, 575 U.S. at 323 (quoting § 1396a(a)(30)(A)). 4 Further, the providers in Armstrong were attempting to assert an implied right of action under the Supremacy Clause and in equity, not a § 1983 action based on a federal statutory right. 575 U.S. at 326–27. 91  No. 17-50282 In addition to the free-choice-of-provider provision being much simpler than the equal access provision, it differs in at least two facets critical to determining whether Congress created a federal statutory right—the issue on appeal in the present case. First, the equal access provision “‘lacks the sort of rights-creating language needed to imply a private right of action,’—that is, just the sort of [rights-creating] language that the free-choice-of-provider provision does contain.” Bentley, 141 F. Supp. 3d at 1216 (quoting Armstrong, 575 U.S. at 331) (plurality op.) (citation omitted); see also Andersen, 882 F.3d at 1226 (“The free-choice-of-provider provision, in contrast [to the equal-access provision analyzed in Armstrong,] is phrased in individual terms that are specific and judicially administrable.” (alterations, citations, and internal quotation marks omitted)). By contrast, as explained in an earlier section, § 1396a(a)(23) confers the free-choice-of-provider right on “any individual eligible for medical assistance” with unambiguous, individually focused terminology. See Harris, 442 F.3d at 461 (citing Gonzaga, 536 U.S. at 283 ). Second, “‘[i]t is difficult to imagine a requirement broader and less specific than’ the equal-access provision’s ‘judgment-laden standard.’” Bentley, 141 F. Supp. 3d at 1217 (quoting Armstrong, 575 U.S. at 328). “For example, to adjudicate a claim under the equal-access provision, a court might be required to determine whether a particular procedure was ‘necessary to safeguard against unnecessary utilization of covered care’—a near-impossible task.” Id. (quoting § 1396a(a)(30)(A)). This concern does not apply to the free- choice-of-provider provision. As this court in Gee and the majority of other circuits to have considered the question have recognized, the term “qualified” in the health care provider context is a concrete and objective standard. Gee, 862 F.3d at 459–60; Anderson, 882 F.3d at 1226; Betlach, 727 F.3d at 967; 92  No. 17-50282 Harris, 442 F.3d at 462 ; Baker, 941 F.3d at 697; Planned Parenthood of Ind., 699 F.3d at 974. “To decide a claim under the free-choice-of-provider provision . . . does not demand that the court obtain a crash-course in health-systems administration; determining that a provider is qualified to perform a service and undertakes to provide such service is well within a court’s competence.” Bentley, 141 F. Supp. 3d at 1217 (alterations, quotation marks, and citation omitted). In short, with respect to judicial administrability courts have observed that “[t]he equal-access provision at issue in Armstrong and the free- choice-of-provider provision at issue here could hardly be more different.” Id. at 1216. Nevertheless, the majority opinion boldly declares that Armstrong “supports the conclusion that Congress did not intend to create a right under § 1396a(a)(23) such that Medicaid patients could contest a state’s determination that a particular provider is not ‘qualified.’” Maj. Op. at 16-17. This is so, the majority claims, because the Supreme Court supposedly “declar[ed] in Armstrong that ‘our later opinions plainly repudiate the ready implication of a § 1983 action that Wilder exemplified. See Gonzaga Univ. v. Doe . . . (expressly “reject[ing] the notion,” implicit in Wilder, “that our cases permit anything short of an unambiguously conferred right to support a cause of action brought under § 1983”).’” Maj. Op. at 17 (alterations in Maj. Op.). The majority’s argument results in a critical misdirection. For starters, the “repudiate” verbiage attributed to Armstrong by the majority does not appear in the body of the Armstrong text, nor was it relevant to the Court’s holding. It was dicta included in Justice Scalia’s epigrammatic footnote explaining why the providers in Armstrong did not try to press their claim through a § 1983 action. More importantly, the majority’s presentation of the dicta’s significance is misleading because in reality the footnote 93  No. 17-50282 announced no new precedent or rule of decision and effected no change in any relevant Supreme Court precedent—the footnote merely re-iterated Gonzaga’s clarification that, under the first Blessing factor, an unambiguously conferred right is necessary to support a § 1983 action. See Armstrong, 575 U.S. at 330, n.*. Indeed, the Armstrong footnoted dicta, by its own terms, obviously neither adds nor repudiates anything of relevance—the footnote itself clearly states that it was merely summarizing “later [post-Wilder] opinions,” specifically Gonzaga, and therefore broke no new ground. Thus, the Armstrong footnote has no impact on the present case. As shown earlier, the free-choice-of- provider provision satisfies the Gonzaga-Blessing test—which was true both before and after Armstrong was decided, since Armstrong did not change the test one iota. In sum, the majority’s reliance on Armstrong is as unpersuasive as the case is inapposite. Armstrong announced no new precedent relevant to the present case, and it concerned a different statutory provision that is thoroughly distinguishable from the free-choice-of-provider provision. B. In Suter, another case relied on by the majority, plaintiffs brought suit both under the Adoption Assistance and Child Welfare Act of 1980 (“Adoption Act”) and § 1983. They alleged the state of Illinois had failed to comply with a provision of the Adoption Act stating that “[i]n order for a State to be eligible for payments under this part, it shall have a plan approved by the Secretary which. . . . . provides that, in each case, reasonable efforts will be made (A) prior to the placement of a child in foster care, to prevent or eliminate the need for removal of the child from his home, and (B) to make it possible for the child to return to his home . . . .” 503 U.S. at 350–51 (quoting § 671(a)(15)). The Suter Court held that the Adoption Act provision did not unambiguously confer an 94  No. 17-50282 individually enforceable right, but rather imposed a general duty on state governments that was intended to be enforced by the federal government. Id. at 363. The Court also held that the Adoption Act’s “reasonable efforts” requirement lacked judicial administrability absent “further statutory guidance as to how ‘reasonable efforts’ are to be measured” in the complicated foster care and adoption context. Id. at 360. But neither of the concerns expressed by the Suter Court apply to the free-choice-of-provider provision, which unambiguously confers an individual right and is judicially administrable. Just like the equal access provision at issue in Armstrong, significant differences between the Adoption Act’s “reasonable efforts” provision and the free-choice-of-provider provision render the majority’s reliance on Suter wholly unpersuasive. Subsequent legislation gives further reason to doubt the force of the majority’s reliance on Suter. After Suter was decided, Congress amended the Social Security Act (which includes both the Adoption Act and the Medicaid Act) to make clear that the inclusion of an individual right in a state plan that is subject to federal oversight does not render the right unenforceable by individuals. The so-called “Suter fix”, 42 U.S.C. § 1320a-2, states that “[i]n an action brought to enforce a provision of this chapter, such provision is not to be deemed unenforceable because of its inclusion in a section of this chapter requiring a State plan or specifying the required contents of a State plan.” See Dickson, 391 F.3d at 603 (recognizing that “[t]he requirement of action under a plan is not, however, dispositive of the question of whether the statute confers rights enforceable by § 1983,” and citing the Suter fix); Harris v. James, 127 F.3d 993 , 1003 (11th Cir. 1997) (same); Ball v. Rodgers, 492 F.3d 1094 , 1111–12 (9th Cir. 2007) (same); Planned Parenthood of Ind., 699 F.3d at 976, n.9 (same). The Suter fix is an express legislative statement to the judiciary 95  No. 17-50282 reaffirming that Congress intended to create individual rights—like the free- choice-of-provider right—within the state plan requirements of the Medicaid Act and related acts. Yet, ignoring the Congressional rebuke at the heart of the Suter fix, the majority cites Suter to justify undercutting the enforceability of one of the most important rights that Congress granted Medicaid patients. For these reasons, contrary to the majority’s assertions, Armstrong and Suter do not undermine the holdings of the majority of circuit courts that have held that a Medicaid recipient has an enforceable right to choose any willing and qualified provider and to challenge the state’s wrongful termination of a chosen qualified and willing provider in a § 1983 action. C. Finally, the majority suggests that providers are better situated than patients to challenge an unlawful termination and opines that Congress must not have intended for patients to have an enforceable federal right because parallel litigation could lead to conflicting results if patients challenge an unlawful provider termination in a § 1983 suit and providers seek separate review. However, the majority’s concerns about litigation are simply not relevant to the issue before us, because the ability of health-care providers to seek administrative or state court review of a provider agreement termination in no way negates or lessens Congress’ unambiguous conferral on patients of the federal right to obtain care from a qualified, willing provider of their choice, nor their ability to enforce that right under § 1983. Providers’ remedies are not a comprehensive enforcement scheme that forecloses patients’ § 1983 remedy—and rightly so. Congress conferred an individual right on Medicaid patients in § 1396a(a)(23) that is independent of administrative remedies available to health care providers; this makes sense because Medicaid is ultimately for the benefit of patients and not for providers (nor state 96  No. 17-50282 governments). See Atkins v. Rivera, 477 U.S. 154 , 156 (1986) (“Medicaid . . . is designed to provide medical assistance to persons whose income and resources are insufficient to meet the cost of necessary care and services.”) (citations omitted); see also Armstrong, 575 U.S. at 332 (stating that Medicaid was created “for the benefit of the infirm whom the providers were to serve, rather than for the benefit of the providers themselves”) (plurality op.). IV. The district court faithfully followed our circuit precedent, Gee, and then, after a three-day hearing, granted injunctive relief because it concluded that the plaintiff Medicaid patients had shown a substantial likelihood of proving that their providers were not terminated because of lack of qualifications, but for unlawful reasons. Because the en banc majority does not follow Gee, and instead holds that the Medicaid patients in this case have no right to bring a § 1983 action, it did not review the district court’s decision. In my view, as explained above, the majority erred in not applying Gee and in departing from the majority of our fellow circuits. Further, upon a proper review of the record, the district court’s decision should have been affirmed. A. Before addressing the merits of the district court’s preliminary injunction, it is appropriate to emphasize that the district court’s decision should be reviewed as we are required to consider any § 1983 case in which the trial court has granted a preliminary injunction to preserve the status quo.5 “A plaintiff seeking a preliminary injunction must establish that he is likely to succeed on the merits, that he is likely to suffer irreparable harm in the absence of preliminary relief, that the balance of equities tips in his favor, and 5 See 11A FED. PRAC. & PROC. CIV. § 2948 (3d ed.) (Wright & Miller). 97  No. 17-50282 that an injunction is in the public interest.” Winter v. Nat. Res. Def. Council, Inc., 555 U.S. 7 , 20 (2008). “We review the district court's determination on each of these elements for clear error, its conclusions of law de novo, and the ultimate decision whether to grant relief for abuse of discretion.” Google, Inc. v. Hood, 822 F.3d 212 , 220 (5th Cir. 2016) (citations and internal quotation marks omitted). Appellate courts must begin from the premise that a district court’s findings of fact, “whether based on oral or other evidence, must not be set aside unless clearly erroneous, and the reviewing court must give due regard to the trial court’s opportunity to judge the witnesses’ credibility.” FED. R. CIV. P. 52(a)(6). “Clear error review follows from a candid appraisal of the comparative advantages of trial courts and appellate courts.” June Med. Servs. L.L.C. v. Russo, 140 S. Ct. 2103 , 2141 (2020) (Roberts, C.J., concurring in judgment) (“While we review transcripts for a living, they listen to witnesses for a living. While we largely read briefs for a living, they largely assess the credibility of parties and witnesses for a living.” (quoting Taglieri v. Monasky, 907 F.3d 404 , 408 (6th Cir. 2018) (en banc))). “In ‘applying this standard to the findings of a district court sitting without a jury, appellate courts must constantly have in mind that their function is not to decide factual issues de novo.’” Id. at 2121 (plurality opinion) (alteration omitted) (quoting Anderson v. Bessemer City, 470 U.S. 564 , 573 (1985)). “Where ‘the district court’s account of the evidence is plausible in light of the record viewed in its entirety, the court of appeals may not reverse it even though convinced that had it been sitting as the trier of fact, it would have weighed the evidence differently.’” Id. (quoting Anderson, 470 U.S. at 573–74). “A finding that is ‘plausible’ in light of the full record—even if another is equally or more so—must govern.” Id. (quoting Cooper v. Harris, 137 S. Ct. 1455 , 1465 (2017)). 98  No. 17-50282 Applying these familiar precepts, I conclude that the district court’s factual findings were plausible, it made no errors of law, and it did not abuse its discretion in granting the individual Medicaid patients injunctive relief. First, the experienced district court judge diligently developed an extensive record—viewing more than eight hours of videos, considering testimony over a three-day hearing, and weighing the relevant evidence—and I have discerned no error, let alone clear error, in his findings. Analyzing the factual support for the state’s termination, the court found that the state lacked prima facie evidence to conclude that the providers were not qualified. Planned Parenthood of Greater Texas Family Planning & Preventative Health Servs., Inc. v. Smith, 236 F. Supp. 3d 974 , 990 (W.D. Tex. 2017). 6 The court also considered evidence, based on the state’s course of conduct, that the state’s termination was motivated by reasons other than whether the providers were qualified. 7 Id. at 997 . Ultimately, the court found that the plaintiffs had 6 In terminating the Provider Plaintiffs’ agreements, the Inspector General relied on a series of controversial videos released by the Center for Medical Progress (CMP), an anti- abortion group, purporting to show that “Planned Parenthood and its affiliates were contracting to sell aborted human fetal tissue and body parts.” Smith, 236 F. Supp. 3d at 984. “After reviewing the CMP video in its entirety and considering the Inspector General’s testimony,” the district court found that “there is no evidence in the record [that] PPGC violated any medical or ethical standard.” Id. at 990. In short, the court found that “the Inspector General did not have any factual support to conclude the bases of termination . . . merited finding the Plaintiff Providers were not qualified. Rather, in light of the current record, it appears the termination decision had nothing to do with the Provider Plaintiffs’ qualifications.” Id. After reviewing the CMP videos and the record, I agree. Moreover, my review of the record indicates that the CMP video was never authenticated under Federal Rule of Evidence (FRE) 901(a) & (b)(1) by the testimony of a witness with knowledge who, from being present at the videotaped encounter or otherwise, could attest that the video is what CMP claims it to be; nor was the CMP video authenticated under FRE 901(b)(2)-(10) or otherwise. Although the proponents of the video produced a certification that the videos had not been altered, this alone does not authenticate the video in accord with FRE 901 or otherwise. 7To highlight one example noted by the district court, the state sent its initial termination notice to the providers before the Inspector General had even viewed the CMP 99  No. 17-50282 established a strong likelihood of success on the merits of their free-choice-of- provider claim—and the record reveals no clear error that would justify an appellate court in reversing that finding. Further, in granting the preliminary injunction, the district court plausibly determined that the Plaintiffs carried their burden to show a substantial threat of irreparable harm had the injunction not issued; that the threatened injury, if the injunction were denied, outweighed any harm that would result if the injunction were granted; and that the grant of the injunction would not disserve the public interest. Again, a review of the record reveals no clear error in the district court’s factual findings, nor any error of law, nor abuse of discretion. Accordingly, unlike the majority, I would affirm the district court’s grant of a preliminary injunction. B. I respectfully disagree with Judge Elrod’s concurrence, echoing the now- vacated panel opinion, that the district court erred in not applying an arbitrary and capricious standard in deciding whether to grant a preliminary injunction. No statute or case law mandates that the district court apply a deferential standard in this case. Indeed, far from being a longstanding part of our precedents, 8 the idea to apply arbitrary and capricious review to this case appears to have originated with the panel. See Planned Parenthood of Greater Texas Family Planning & Preventative Health Servs., Inc v. Smith, 913 F.3d videos that supposedly formed the basis for the state’s determination that the providers had violated medical and ethical standards, and then waited more than a year before sending a final notice which contained material differences in the grounds for termination. Smith, 236 F. Supp. 3d at 997. 8 The Abbeville court noted a “litany of cases for the indisputable proposition that a state agency’s rate-setting action is entitled to considerable deference.” 3 F.3d at 802 . (emphasis added). Of course, the present case does not involve a rate-setting action. 100  No. 17-50282 551, 571 (5th Cir. 2019) (panel concurrence). But, as discussed above, the rules are well-settled regarding how a district court should adjudicate a motion for preliminary injunction in a § 1983 action brought by individuals alleging that a person acting under color of state law has deprived them of their federal statutory rights. Therefore, evidence of the state’s actions should be treated like any other evidence that a district court may consider in making its factual findings. 9 The case that my colleague Judge Elrod relies upon, Abbeville General Hospital v. Ramsey, 3 F.3d 797 (5th Cir. 1993), is clearly inapposite and distinguishable from the present case. In Abbeville, hospital service providers challenged the Medicaid reimbursement rates that Louisiana set pursuant to the Boren Amendment. Abbeville, 3 F.3d at 800–01. The Boren Amendment required the state to make factual findings as part of its rate-making process and submit those findings and other assurances to the federal Medicaid agency for approval. Id. The law also mandated that the reimbursement rates be “reasonable and adequate.” Id. at 802 . The Abbeville court decided that Louisiana’s compliance with the procedural requirements of the Boren Amendment should be reviewed de novo, while its substantive findings and reimbursement rates should be reviewed under the arbitrary and capricious standard. Id. at 803 . 10 9 The same standard of proof applies to the question of whether a provider is “qualified” as applies to any other factual question in a civil case: the preponderance of the evidence. See 5th Cir. Pattern Civil Jury Instruction 3.2 (explaining that a finder of fact in a civil case should determine if a fact is established by considering whether the plaintiff proved it by the preponderance of the evidence). 10 Ultimately, the court held that Louisiana had not complied with the procedural requirements of the Boren Amendment. Abbeville, 3 F.3d at 809–10. 101  No. 17-50282 The Abbeville court explicitly based its decision to apply the arbitrary- and-capricious standard on two factors: (1) the discretionary nature of the rate- setting action, i.e. whether reimbursement rates were “reasonable and adequate” as required by the Boren Amendment, and (2) the federal agency approval of the state’s rates. “It is precisely the [state] agency’s exercise of discretion and the [federal Department of Health & Human Services] Secretary’s approval that warrant application of the arbitrary and capricious standard of review.” Id. at 803 (citing Illinois Health Care Assoc. v. Bradley, 983 F.2d 1460 , 1463 (7th Cir. 1993)). Neither of the Abbeville court’s rationales for deferential review in the reimbursement rate context apply in the context of a patient’s free-choice-of-provider claim. First, the nature of the state action challenged in the present case is radically different from the rate-setting considered in Abbeville. Setting “reasonable and adequate” reimbursement rates involves a great amount of discretion and the need to “balance political and financial interests underlying the Medicaid plan.” Id. at 802. By contrast, the question of whether a provider is “qualified” is concrete and objective and does not require such a balancing of competing interests. See Gee, 862 F.3d at 462; see also Baker, 941 F.3d at 702; Andersen, 882 F.3d at 1230; Planned Parenthood of Ind., 699 F.3d at 978; Betlach, 727 F.3d at 969. Second, the involvement of the federal Medicaid agency is lacking. As noted above, the Boren Amendment required that the state agency submit findings and assurances to the federal agency for approval. Abbeville, 3 F.3d at 803 . By contrast, in the present case there is no federal agency involvement. Simply put, Abbeville—a Boren Amendment rate- setting case—is inapposite and does not apply here. 102  No. 17-50282 V. This past summer, in June Medical Services L.L.C. v. Russo, the Supreme Court strongly reaffirmed that, even in abortion-related cases, the principles of stare decisis, as well as clear error review, must be respected. See 140 S. Ct. at 2120–32 (plurality opinion); id. at 2134, 2141 (Roberts, C.J., concurring in judgment). Both Justice Breyer, writing for a four-justice plurality, and Chief Justice Roberts, concurring in the judgment, concluded that, under the facts found by the district court without clear error, because Louisiana’s admitting privileges law imposed an undue burden on access to abortion just as severe as that imposed by the nearly identical Texas law invalidated four years prior in Whole Woman’s Health v. Hellerstedt, 136 S. Ct. 2292 (2016), as revised (June 27, 2016), it could not stand under principles of stare decisis. See June Med. Servs. L.L.C., 140 S. Ct. at 2120–32, 2134, 2141. In his opinion concurring in the judgment, Chief Justice Roberts issued a lengthy admonition pertaining to the duty of judges to adhere to the principles of stare decisis. He explained that “[t]he legal doctrine of stare decisis requires us, absent special circumstances, to treat like cases alike.” Id. at 2134; see also id. (“Stare decisis (‘to stand by things decided’) is the legal term for fidelity to precedent.”). He stated: It has long been “an established rule to abide by former precedents, where the same points come again in litigation; as well to keep the scale of justice even and steady, and not liable to waver with every new judge’s opinion.” 1 W. Blackstone, Commentaries on the Laws of England 69 (1765). This principle is grounded in a basic humility that recognizes today’s legal issues are often not so different from the questions of yesterday and that we are not the first ones to try to answer them. Because the “private stock of reason . . . in each man is small, . . . individuals would do better to avail themselves of the general bank and capital of nations and of 103  No. 17-50282 ages.” 3 E. Burke, Reflections on the Revolution in France 110 (1790). Adherence to precedent is necessary to “avoid an arbitrary discretion in the courts.” The Federalist No. 78, p. 529 (J. Cooke ed. 1961) (A. Hamilton). The constraint of precedent distinguishes the judicial “method and philosophy from those of the political and legislative process.” Jackson, Decisional Law and Stare Decisis, 30 A. B. A. J. 334 (1944). The doctrine also brings pragmatic benefits. Respect for precedent “promotes the evenhanded, predictable, and consistent development of legal principles, fosters reliance on judicial decisions, and contributes to the actual and perceived integrity of the judicial process.” Payne v. Tennessee, 501 U.S. 808 , 827 (1991). It is the “means by which we ensure that the law will not merely change erratically, but will develop in a principled and intelligible fashion.” Vasquez v. Hillery, 474 U.S. 254 , 265 (1986). In that way, “stare decisis is an old friend of the common lawyer.” Jackson, supra, at 334. Id. Today, the majority fails to heed the Chief Justice’s warning. It overrules our circuit precedent, Gee, just three years after we decided the case, after we declined to review it en banc, after the Supreme Court denied certiorari, and after other circuits relied on the decision as precedent in grappling with the same issue. Gee, 876 F.3d 699 , 700 (5th Cir. 2017) (denying rehearing en banc); Gee v. Planned Parenthood of Gulf Coast, Inc., 139 S. Ct. 408 (2018) (denying certiorari); see generally Baker, 941 F.3d 687 (citing Gee); Andersen, 882 F.3d 1205 (same). Gee is well written and soundly reasoned, and nothing of substance has changed since we decided it—while the Eighth Circuit created a circuit split subsequent to Gee, neither the statute we are analyzing nor the leading Supreme Court cases that inform our analysis have changed. 104  No. 17-50282 I respectfully call on my colleagues to heed the admonitions of the June Medical Court and Chief Justice Roberts, to apply the principles of stare decisis “to keep the scale of justice even and steady, and not liable to waver with every new judge’s opinion,” June Med. Servs. L.L.C., 140 S. Ct. at 2134 (Roberts, C.J., concurring in the judgment) (quoting 1 W. Blackstone, Commentaries on the Laws of England 69 (1765)), and to reconsider its decision to overrule circuit precedent and eviscerate Medicaid patients’ freedom of choice. For these reasons, and out of respect for this court, I collegially dissent. 105

2020-12-02 01:00:24.222396+00

http://www.ca5.uscourts.gov/opinions/unpub/20/20-20184.0.pdf

Case: 20-20184 Document: 00515656881 Page: 1 Date Filed: 12/01/2020 United States Court of Appeals for the Fifth Circuit United States Court of Appeals Fifth Circuit FILED December 1, 2020 No. 20-20184 Lyle W. Cayce Clerk Pierce Partners, GP, Plaintiff—Appellee, versus Marcus Morton, Defendant—Appellant. Appeal from the United States District Court for the Southern District of Texas USDC No. 4:19-CV-335 Before Haynes, Willett, and Ho, Circuit Judges. Per Curiam:* Pierce Partners, GP and D’Arbonne Bend, LLC (DBL) signed a promissory note under which Pierce Partners agreed to loan DBL $1 million to finance the theatrical release of a movie. Marcus Morton, DBL’s managing member, signed both the note and a Continuing Personal Guaranty of DBL’s indebtedness. Both the promissory note and guaranty had choice-of-law and * 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: 20-20184 Document: 00515656881 Page: 2 Date Filed: 12/01/2020 No. 20-20184 forum-selection clauses, stating, respectively, that Texas law applied to the contracts, and disputes arising under the contracts would be adjudicated in Texas. The movie had disappointing box office results, and DBL defaulted on its loan, which triggered Morton’s obligation to pay under the guaranty. Pierce Partners demanded Morton’s performance, but Morton has yet to make a payment. Per the guaranty’s forum-selection clause, Pierce Partners filed this lawsuit in the Southern District of Texas. Pierce Partners moved for summary judgment, and the district court granted the motion. In between the filing and service of the complaint in this case, DBL filed a declaratory-judgment suit in California state court. D’arbonne Bend LLC v. Pierce Partners III, LLC, No. 4:20-CV-589, 2020 WL 6484642 at *1 (S.D. Tex. Nov. 4, 2020) (recounting the California case’s procedural history). Pierce Partners removed the case to federal court, and the case was transferred to the Southern District of Texas. Id. The district court in that case also granted Pierce Partner’s motion for summary judgment. We review the district court’s grant of summary judgment in this case de novo. Willis v. Cleco Corp., 749 F.3d 314 , 317 (5th Cir. 2014). “Summary judgment should be granted when the moving party shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Id. (internal quotation marks omitted). On appeal, Morton only contests whether the note’s interest rate is usurious. He argues that California law, not Texas law, applies because the note does not have a choice-of-law provision, and California has a greater interest in this case. Morton’s arguments fail. First, the note does contain a choice-of-law clause: “[T]he provisions of this Note shall be governed by the laws of the State of Texas.” See also D’arbonne Bend LLC, 2020 at *2 (“Both the loan agreement and the guaranty 2 Case: 20-20184 Document: 00515656881 Page: 3 Date Filed: 12/01/2020 No. 20-20184 at issue here provide in multiple clauses that Texas law will govern any disputes.”). Morton must show then that the choice-of-law provision is unenforceable. “To render a choice-of-law provision unenforceable, a party must satisfy the standards in Section 187(2) of the Restatement (Second) of Conflict of Laws, which provides that” the choice-of-law provision governs unless: (a) the chosen state has no substantial relationship to the parties or the transaction and there is no other reasonable basis for the parties’ choice, or (b) application of the law of the chosen state would be contrary to a fundamental policy of a state which has a materially greater interest than the chosen state in the determination of the particular issue and which, under the rule of § 188, would be the state of the applicable law in the absence of an effective choice of law by the parties. Cardoni v. Prosperity Bank, 805 F.3d 573 , 581 (5th Cir. 2015) (applying Texas law). Subsection (a) does not help Morton because Pierce Partners is a Texas corporation. Thus, “[t]he parties had a reasonable basis for agreeing that Texas law would apply given that [Piece Partners] is headquartered in the state.” Id. As to subsection (b), Morton only argues that California’s maximum interest rate is 10% whereas Texas’s is 28%. So according to Mor- ton, California has a “fundamental policy” against usury. Morton also adds that the production of the movie occurred in California, and thus California has a “materially greater interest” in this dispute than Texas does. But these are all legal arguments, not factual disputes. Morton is a citizen of Louisiana, as is DBL. Pierce Partners is a citizen of Texas. And although the movie was produced in California, the loan was 3 Case: 20-20184 Document: 00515656881 Page: 4 Date Filed: 12/01/2020 No. 20-20184 to pay for the movie’s theatrical release, not its production. In short, there are no relevant fact disputes, much less genuine disputes as to any material fact. Plus, as the district court noted, “Morton provides the Court with no authority suggesting that it is a fundamental policy of California to apply its usury law to a commercial loan provided by a Texas bank to a Louisiana cor- poration and guaranteed by a Louisiana citizen.” Just because Texas’s usury law is not as protective as California’s does not mean that “enforcing the parties’ bargain on this issue” offends California public policy. Cardoni, 805 F.3d at 580. Finally, Morton argues that California law would apply in the absence of a choice-of-law provision because Morton brought a declaratory judgment action in California state court. But after that case was removed and trans- ferred, the district court applied Texas law in accordance with the contract’s forum-selection clause. D’arbonne Bend LLC, 2020 WL at *2 (explaining that while typically the law of the transferor court applies, an exception arises when the transfer is made to enforce a forum-selection clause). For the reasons stated, we AFFIRM. 4

2020-12-02 01:00:25.686759+00

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Case: 20-10530 Document: 00515656601 Page: 1 Date Filed: 12/01/2020 United States Court of Appeals for the Fifth Circuit United States Court of Appeals Fifth Circuit FILED December 1, 2020 No. 20-10530 Lyle W. Cayce Clerk In re: Bruce Carneil Webster, Movant. Motion for an order authorizing the United States District Court for the Northern District of Texas to consider a successive 28 U.S.C. §2255 application Before Willett, Ho, and Engelhardt, Circuit Judges. Per Curiam:* Prisoner Bruce Carneil Webster moves this court for permission to file a successive habeas petition, pursuant to 28 U.S.C. § 2255 (h)(2), arguing that his conviction for using a firearm during the commission of a crime of violence, in violation of 18 U.S.C. § 924 (c), is unconstitutional under United States v. Davis, 139 S. Ct. 2319 (2019). The felony offenses of kidnapping resulting in death and conspiracy to commit kidnapping of which Webster also was convicted were charged as predicates to his § 924(c) offense. 1 * 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. 1 Webster received a sentence of death for his kidnapping offense, life imprisonment for the conspiracy offense, and sixty months of imprisonment for the firearm offense. On September 22, 2020, however, the Seventh Circuit affirmed an Indiana federal Case: 20-10530 Document: 00515656601 Page: 2 Date Filed: 12/01/2020 No. 20-10530 Section 924(c) defines a crime of violence in two alternative ways. Its “residual clause” defines a crime of violence as a felony “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 committing the offense.” § 924(c)(3)(B). Its “elements clause” defines a crime of violence as a felony that “has as an element the use, attempted use, or threatened use of physical force against the person or property of another.” § 924(c)(3)(A). Davis declared the residual clause unconstitutionally vague but left the elements clause intact. Recently, in a matter involving Webster’s co-conspirator, Orlando Hall, we held that kidnapping resulting in death, in violation of 18 U.S.C. § 1202 (a)(1), constitutes a crime of violence under § 924(c)’s elements clause. See In re Hall, 979 F.3d 339 , 343–47 (5th Cir. 2020). Given our decision in In re Hall, Webster likewise fails to make the necessary prima facie showing that his underlying claim relies “on a new rule of constitutional law, made retroactive to cases on collateral review by the Supreme Court, that was previously unavailable.” 28 U.S.C. § 2255 (h)(2). Accordingly, Webster’s request for authorization to file a successive § 2255 petition is DENIED. district court’s vacatur of the death sentence based on a finding that Webster is intellectually disabled and thus, under Atkins v. Virginia, 536 U.S. 304 (2002), constitutionally ineligible for a death sentence. See Webster v. Watson, 975 F.3d 667 (7th Cir. 2020). 2

2020-12-02 01:00:26.11365+00

http://www.ca5.uscourts.gov/opinions/pub/17/17-20661-CV1.pdf

United States Court of Appeals for the Fifth Circuit No. 17-20661 Deshun Thomas, Petitioner—Appellant, versus Bobby Lumpkin, Director, Texas Department of Criminal Justice, Correctional Institutions Division, Respondent—Appellee. Appeal from the United States District Court for the Southern District of Texas USDC No. 4:14-CV-290 ON PETITION FOR REHEARING EN BANC (Opinion 7/29/20, 968 F.3d 352 (5th Cir. 2020) Before Davis, Jones, and Engelhardt, Circuit Judges. Per Curiam: The court having been polled at the request of one of its members, and a majority of the judges who are in regular active service and not disqualified not having voted in favor (Fed. R. App. P. 35 and 5th Circ. R. 35), the petition for rehearing en banc is DENIED.  No. 17-20661 In the en banc poll, 6 judges voted in favor of rehearing (Judges Stewart, Dennis, Elrod, Graves, Higginson, and Willett), and 11 judges voted against rehearing (Chief Judge Owen and Judges Jones, Smith, Southwick, Haynes, Costa, Ho, Duncan, Engelhardt, Oldham and Wilson). ENTERED FOR THE COURT: ______________ Edith H. Jones United States Circuit Judge 2  No. 17-20661 James E. Graves, Jr., Circuit Judge, dissenting from the denial of rehearing en banc, joined by ELROD, Circuit Judge: Because the panel opinion is contrary to both Haynes v. Cain, 298 F.3d 375 (5th Cir. 2002) and United States v. Cronic, 466 U.S. 648 (1984), I respectfully dissent from the denial of rehearing en banc. This court granted a certificate of appealability on Deshun Thomas’ claim that his trial counsel failed to subject the prosecution’s case to meaningful adversarial testing in violation of Cronic. The panel found no error and affirmed. In doing so, the panel concluded that Thomas’ claim failed regardless of whether de novo review or AEDPA applied.1 To prevail on a claim of ineffective assistance of counsel, a petitioner must typically satisfy the two-prong test of deficiency and prejudice under Strickland v. Washington, 466 U.S. 668 , 687 (1984). To show that counsel’s performance was deficient, “requires showing that counsel made errors so serious that counsel was not functioning as the counsel guaranteed the defendant by the Sixth Amendment.” Id. at 687 (internal marks omitted). To establish prejudice, a petitioner must show “that counsel’s errors were so serious as to deprive the defendant of a fair trial, a trial whose result is reliable.” Id. As the panel stated, Cronic created a limited exception to the application of Strickland’s two-part test where prejudice is presumed in 1 I agree that de novo review applies. However, I would conclude that Thomas is entitled to relief under either de novo review or AEDPA deference. 3  No. 17-20661 certain situations. See Haynes, 298 F.3d at 380 . Prejudice is presumed in three situations, (1) the complete denial of counsel at a critical stage; (2) if counsel entirely fails to subject the prosecution’s case to meaningful adversarial testing; and (3) where counsel is called upon to render assistance under circumstances where competent counsel very likely could not. See Bell v. Cone, 535 U.S. 685 , 695-96 (2002); see also Haynes, 298 F.3d at 380 ; and Cronic, 466 U.S. at 659 . Thomas relies on the second exception. The panel noted that the state Fourteenth Court of Appeals “held that Thomas’s trial counsel’s closing arguments were professionally incompetent in violation of Strickland v. Washington, 466 U.S. 668 . . . (1984) because they essentially conceded his client’s guilt, but appellate counsel had waived any showing, pursuant to the other Strickland prong, of prejudice to Thomas.” Thomas v. Davis, 968 F.3d 352 , 353 n.1 (5th Cir. 2020). The panel further found it “rather odd” that neither the state habeas court nor the Texas Court of Criminal Appeals addressed the state appellate court’s holding. But the panel concluded that the discrepancy did not matter. Id. at n.2. Specifically, the Fourteenth Court of Appeals affirmed the conviction and sentence but said: However, given trial counsel’s closing argument in the punishment phase, in which he made specific reference to trial counsel’s concession of appellant’s guilt in closing argument in the punishment phase, combined with counsel’s references to the overwhelmingly powerful evidence at the guilt- innocence phase, the totality of the representation amounts to conduct so outrageous that it falls well-below professional 4  No. 17-20661 standards. Appellant’s trial counsel emphasized the strength of the evidence against appellant and affirmatively argued both for finding appellant guilty and for assessing a substantial sentence. Under the circumstances of this case, no plausible basis exists and no strategic motivation could explain why trial counsel fashioned his arguments as he did. Appellant has rebutted the presumption that counsel’s conduct was reasonably professional and motivated by sound trial strategy because counsel’s closing arguments amount to conduct “so outrageous that no competent attorney would have engaged in it.” Appellant has satisfied the first prong in Strickland by showing his trial counsel’s conduct was deficient such that it fell below the standard of professional norms. See Thomas v. State, No. 14-06-00540-CR, 2008 WL 596228 , *4 (Tex. App. Mar. 6, 2008)(Thomas II)(internal citations omitted). But, after finding that Thomas established the deficiency prong of Strickland, the court then found that he had “waived error as to Strickland’s second prong by failing to adequately brief it on appeal.” Id. at *5. The panel here relied on Haynes to conclude that Thomas’ trial counsel did not entirely fail to subject the prosecution’s case to meaningful adversarial testing. Thomas, 968 F.3d at 355; see also Haynes, 298 F.3d at 381 . In doing so the panel directed us to the district court’s opinion, which said that counsel advocated on Thomas’ behalf throughout trial, moved to suppress evidence and cross-examined witnesses. It further concluded that counsel did not concede the only factual issue in dispute, but merely described evidence against Thomas as “really strong,” “substantial,” “persuasive,” and “pretty powerful.” Thomas, 968 F.3d at 355. The panel also pointed to counsel’s admonishment to the jury that any reasonable doubt 5  No. 17-20661 required them to acquit, before concluding that, read in context, counsel’s “summation indicates that his comments were strategically made to maintain credibility with the jury.” Id. at 356. Finally, it concluded that counsel’s sentencing arguments during the punishment phase confirmed this “strategy,” while noting that counsel died after trying this case and was never available for post-conviction inquiry about the defense or any alleged strategy. Id. at n.6. However, the record does not support these conclusions, which conflict with controlling authority. As an initial matter, strategy goes to counsel’s performance, not the prejudice factor. Strickland, 466 U.S. at 698- 99. The state appellate court already found that Thomas had established deficient performance. The only issue remaining was whether the deficient performance prejudiced Thomas, which the court said Thomas had failed to brief. The panel and the district court disregarded the state appellate court’s finding and reweighed the performance factor to determine that counsel’s deficient performance was mere strategy. As the panel conceded, “Cronic applies to concessions only when they result in a ‘complete abandonment of counsel’; that is, the attorney must concede ‘the only factual issues in dispute.’” Thomas, 968 F.3d at 355 (quoting Haynes, 298 F.3d at 381 ).2 Again, the panel concluded that counsel 2 The panel cites Barbee v. Davis, 728 F. App’x 259, 264 (5th Cir. 2018) for the proposition that the “Supreme Court has held that even defense counsel’s full concession of guilt is not necessarily an indication that counsel has entirely failed to function as the client’s advocate.” Id. (quoting Florida v. Nixon, 543 U.S. 175 , 189–91 (2004)) (internal marks and emphasis omitted). Nixon is easily distinguished as counsel there explained his 6  No. 17-20661 had not conceded the only factual issues in dispute, pointing to various actions taken by counsel throughout the trial. However, regardless of what counsel did earlier at trial, he conceded the only factual issues in dispute when he admitted Thomas’ guilt during closing and, thus, abandoned any attempt to subject the prosecution’s case to meaningful adversarial testing. Moreover, following the concession in Haynes, counsel “remained active at trial, probing weaknesses in the prosecution’s case on the issue of intent,” and cross-examining witnesses. Id. 298 F.3d at 382 . Here, counsel conceded guilt during closing arguments. Thus, there was no opportunity for counsel to rectify his concession during some later portion of the proceedings. Specifically, counsel repeatedly assured the jury of his trial experience and made numerous explicit statements regarding Thomas’ guilt, such as: (1) “it seems really strong to me that this young man is guilty, this person I’m representing is guilty;”(2) he was “convinced that the evidence [of Thomas’s guilt] [was] pretty powerful;” (3) there was “a substantial amount of evidence” demonstrating Thomas’ guilt; and (4) “If you reach a verdict that says he’s guilty, that’s the way it is. I appreciate it.” Thomas II, 2008 WL 596228 , ** 1-2 (emphasis omitted). The jury convicted Thomas, and the trial proceeded to the punishment phase, where defense counsel first acknowledged that he had “practically consented to a guilty verdict in this case, because I thought the evidence was overwhelming based on the many strategy to Nixon several times to “concede guilt and to home in, instead, on the life or death penalty issue.” Id. at 189. Counsel here neither explained his strategy nor attempted to get a shorter sentence. In fact, counsel here failed to offer any mitigation. 7  No. 17-20661 years of experience of trying cases” and reiterated that the evidence against Thomas was “overwhelming.” Id. at 2 (emphasis omitted). Counsel then argued that “[a]ll of the evidence—and I would be a fool if I suggested otherwise, and I’m not—is compelling that this young man deserves a pretty substantial sentence. I’m not talking about of [sic] sentence of 15 years. All of the evidence is compelling.” Counsel then told the jury he wanted them to take into consideration that “[a] young man lost his life, destroyed his mother practically” and all of Thomas’ prior convictions before stating, “I can assure you I’m a fairly wordy individual, but I know I can’t deter you from the things you ought to do in this case. And in this case, I’m convinced, based on all of the facts, he deserves a substantial sentence.” Thomas II, 2008 WL 596228 , 2. Counsel offered nothing in mitigation and told the jury he could not quarrel with any sentence the jury selected. Id. That complete abandonment of counsel falls squarely within Cronic. See Haynes, 298 F.3d at 381 . When there is a “breakdown of the adversarial process,” prejudice is presumed. Cronic, 466 U.S. at 657–58. Counsel’s explicit concession of guilt on the only offense and request for a substantial sentence as a result is a breakdown of the adversarial process. Further, the subsequent objection regarding Thomas’ failure to testify does not in any way correct this breakdown. The panel ultimately concluded that counsel’s “strategy” paid off because Thomas received only seventy-five years imprisonment rather than life. The record in this matter clearly demonstrates that Thomas received seventy-five years instead of life in spite of counsel’s performance, not because of counsel’s performance. Counsel 8  No. 17-20661 did not admit Thomas’ guilt only to a lesser-included offense; counsel admitted Thomas’ guilt to the only offense. Counsel did not concede guilt in an attempt to get a lighter sentence; counsel conceded guilt and asked for a substantial sentence while failing to present anything in mitigation. At the point that counsel conceded guilt, he failed to mount a defense regardless of anything he had done prior to that concession. At the point that counsel asked for a substantial sentence, he verified that this was not an attempt at strategy. Thus, the panel decision is contrary to both Haynes and Cronic. For these reasons, I respectfully dissent from the denial of rehearing en banc. 9

2020-12-02 01:00:50.888429+00

https://ecf.dcd.uscourts.gov/cgi-bin/show_public_doc?2019cv1137-18

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA ) ROGER LINDSAY, ) ) Plaintiff, ) ) v. ) Case No. 19-cv-1137 (TSC) ) ROBERT WILKIE, et al., ) ) Defendants. ) ) MEMORANDUM OPINION Plaintiff Roger Lindsay brings this case against his employer, the Department of Veterans Affairs (the VA), VA Secretary Robert Wilkie, and three employees at the Veterans Administration Medical Center (VA Medical Center)—Elton Artis, Robyn Hardy, and Stanley Staton. Plaintiff alleges that Artis, Hardy, and Staton, in their individual capacities, reassigned his work responsibilities, excluded him from certain office operations, and retaliated against him for filing a complaint with the agency’s whistleblower office in violation of the First Amendment (Count I) and Due Process Clause of the Fifth Amendment (Count II). (ECF No. 1, Compl. ¶¶ 22–28.) He seeks money damages for these violations under Bivens v. Six Unknown Federal Narcotics Agents, 403 U.S. 388 (1971). (Id. ¶ 1.) Plaintiff also claims Wilkie, acting in his official capacity, violated the Family Medical Leave Act (FMLA), 29 U.S.C. § 2601 et seq. (Count III). (Id. ¶ 31–35.) Defendants move to dismiss all counts for failure to state a claim under Rule 12(b)(6) of the Federal Rules of Civil Procedure. (ECF No. 12.) Alternatively, as to Count III, Defendants seek summary judgment pursuant to Rule 56. For the reasons set forth below, the motion to dismiss will be GRANTED as to all counts. 1  I. BACKGROUND The facts set forth in the Complaint leave many open questions which make it difficult to determine whether the Plaintiff has presented viable causes of action. Plaintiff’s response to Defendants’ motion to dismiss fails to provide further clarification. The facts below are pieced together from the Complaint. 1 Plaintiff Roger Lindsay is the Deputy Chief of Police at the VA Medical Center in the District of Columbia, a position he has held since December 2017. (Compl. ¶¶ 3, 5.) His duties include overseeing security, training, administration, and operations (which includes the supervision of officers). (Id. ¶ 6.) Plaintiff does not provide more specific information about his job duties. In May of 2018, Troy Brown became the Acting Chief of Police. (Id. ¶ 6.) Two months later, Brown temporarily promoted investigator Elton Artis to serve as the Acting Deputy Chief of Police—the same title held by Plaintiff. (Id.) Plaintiff alleges that Brown created that position, which previously “did not exist.” (Id.) Approximately one month later, Plaintiff “requested that Artis be removed from the position” because Artis was “performing [Plaintiff’s] duties and causing a disruption in the chain of command.” (Id.) Plaintiff does not specify to whom he made this request but claims his “request was not addressed.” (Id.) Nor is it clear from the Complaint what specific job duties were reassigned from Plaintiff to Artis. Three months later, on October 31, 2018, Plaintiff took annual leave for one week to qualify for his service weapon license. (Id. ¶ 8.) It is unclear whether this was a requirement of his job, why he needed to take annual leave to do so, whether he was directed to do so by 1 The facts in this section are drawn from the allegations in the Complaint and interpreted in the light most favorable to the Plaintiff. Unless otherwise noted, they are not in dispute. 2 superior officers, or whether he needed an entire week to do so. That same day, Assistant Medical Center Director Stanley Staton posted a job opening for the “Acting Chief of Police Service” position, which closed on November 7, 2018. (Id.) Plaintiff learned that he was ineligible to apply for the position until he requalified for his service weapon. (Id.) An unidentified person told Plaintiff that requalification for his service weapon would take place on November 7 at 11:00 a.m., but the date was moved to November 14. (Id.) Plaintiff was informed of the date change by one of Artis’ direct reports. (Id.) Plaintiff believes that the date “was changed to prevent him from applying for the position because he was the most qualified applicant.” (Id.) Artis was ultimately selected as Acting Chief of Police and Plaintiff filed a “congressional complaint” with Maryland’s United States Senators, and a complaint with the Veterans Administration Whistleblower’s Office. (Id. ¶ 10.) He complained of “widespread mismanagement and violations of OPM ([Office of Personnel Management)] guidelines” including reassigning his duties to Artis, creating the Acting Deputy Police Chief position, and only posting the Acting Chief of Police position for five days so as to exclude Plaintiff from consideration. (Id.) The Complaint does not detail the alleged widespread mismanagement, OPM guideline violations, or which specific duties were reassigned from Plaintiff to Artis. Shortly after Plaintiff filed the congressional complaint, Staton called Plaintiff into a meeting and “angrily confronted him.” (Id.) After Artis’ term expired in January 2019, Robyn Hardy became the Chief of Police. (Id. ¶ 11.) Though Plaintiff does not provide a source for this information, he claims Hardy met with Artis and Human Resources to “discuss options for removing Deputy Chief Plaintiff from his position.” (Id.) Hardy also “refused to meet with [Plaintiff] or include him in any of the 3 operations of Police Service.” (Id.) According to Plaintiff, Hardy also reassigned Plaintiff’s employment duties to Artis. For instance, Plaintiff states he is “responsible for the supervision and discipline of officers,” but he was not a part of the decision to terminate an employee who assaulted a female visitor at the VA Medical Center. (Id. ¶¶ 11, 13.) Plaintiff does not explain which of his other duties were reassigned or whether he was stripped of all supervisory authority, however. In March, Plaintiff submitted a written request for FMLA leave for back surgery, to begin on March 21. (Compl. ¶ 17.) The day before he was scheduled to begin his leave, he received an email from a VA privacy officer “advising him that the Privacy Office has received a report that he violated the Agency’s Privacy Act by releasing personal identifiable information . . . in reference to a personal statement that Plaintiff Lindsay provided to [a terminated employee] for the MPD investigation in reference to his treatment at the VA Medical Center.” (Id.) Though Plaintiff only had approximately fifteen minutes left on his shift before he was scheduled to take leave, the notice ordered him to respond within seventy-two hours. (Id.) He does not indicate whether he responded to the letter or what became of the alleged violation. Although Plaintiff alleges that the VA never approved his request for leave, it is undisputed that he took his FMLA leave. (Id. ¶ 18.) He alleges that immediately after he began his leave, Hardy “removed” Plaintiff from his position as the Deputy Chief of Police. He also states that Artis moved into Plaintiff’s office, removed Plaintiff’s name from the door, and removed Plaintiff’s name from various databases in the Police Service. (Id.) Plaintiff further alleges that while he was on medical leave, an unnamed representative from the VA Medical Center called and advised him that when he returned to work, he might be placed in a position other than the Deputy Chief of Police. (Id. ¶ 19.) 4  Plaintiff brings two constitutional claims against Artis, Hardy, and Staton in their individual capacities, alleging retaliation under the First Amendment (Count I) and due process violations under the Fifth Amendment (Count II). While Count I is labeled as a Bivens claim, (Compl. at 9), Count II contains no reference to Bivens or to monetary relief—it appears to be a free-standing Fifth Amendment claim, (id. ¶¶ 25–29). Plaintiff also argues that Defendants failed to approve his medical leave and retaliated against him by falsely charging him with a Privacy Act violation and removing him from his position as Deputy Chief of Police in violation of the FMLA (Count III). Plaintiff seeks: 1) a declaratory judgment that the individual Defendants’ conduct violated his rights under the First and Fifth Amendments and the FMLA; 2) a permanent injunction prohibiting Defendants Hardy, Artis, and Staton from repeating charges that Plaintiff violated the Privacy Act; 3) compensatory and punitive damages; and 4) attorney’s fees and other litigation costs. (Id. at 13–14.) Defendants have moved to dismiss the complaint for failure to state a claim. Interpreting Counts I and II as Bivens claims, Defendants argue that the Supreme Court has never recognized a non-statutory remedy under the First Amendment against federal officials nor has it recognized an implied damages remedy for a Fifth Amendment due process claim arising out of federal employment where employment actions are covered by the Civil Service Reform Act. Defendants also contend that Plaintiff has failed to establish that he suffered a materially adverse employment action and thus his FMLA claim should be dismissed pursuant to Rule 12(b)(6). 2 2 Defendants have moved, in the alternative, for summary judgment. Having concluded that Defendants are entitled to dismissal pursuant to Rule 12(b)(6) on all counts of the Complaint, the court need not consider whether summary judgment is warranted. 5  II. ANALYSIS A. Legal Standard A motion to dismiss under Fed. R. Civ. P. 12(b)(6) for failure to state a claim tests the legal sufficiency of a complaint. Browning v. Clinton, 292 F.3d 235 , 242 (D.C. Cir. 2002). “To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662 , 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544 , 570 (2007)). A claim is plausible when it alleges sufficient facts to permit the court “to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Iqbal, 556 U.S. at 678 (citation omitted). When considering a motion to dismiss for failure to state a claim, the court must construe the complaint in the light most favorable to the plaintiff and must accept as true all reasonable factual inferences drawn from well-pleaded factual allegations. See Schuler v. United States, 617 F.2d 605 , 608 (D.C. Cir. 1979), aff’d on reh’g, 628 F.2d 199 (D.C. Cir. 1980) (internal quotations omitted) (“The complaint must be liberally construed in favor of the plaintiff, who must be granted the benefit of all inferences that can be derived from the facts alleged.”). The court can only consider “the facts alleged in the complaint, any documents either attached to or incorporated in the complaint and matters of which [the court] may take judicial notice.” EEOC v. St. Francis Xavier Parochial Sch., 117 F.3d 621 , 624 (D.C. Cir. 1997). B. First Amendment In Count I, which is labeled as a Bivens claim, Plaintiff seeks money damages against government officials who, acting in their official capacities, violated his First Amendment rights. (See Compl. ¶ 24.) In Bivens v. Six Unknown Named Agents of Federal Bureau of Narcotics, “the Supreme Court held that the Fourth Amendment creates an implied damages action for 6 unconstitutional searches against line officers enforcing federal drug laws.” Loumiet v. United States, 948 F.3d 376 , 377–78 (D.C. Cir. 2020) (citing Bivens v. Six Unknown Named Agents of Fed. Bureau of Narcotics, 403 U.S. 388 , 392–93 (1999)). Since then, the Supreme Court has interpreted Bivens to provide “a vehicle for suing federal officials in their individual capacities for money damages for a very small group of constitutional violations.” 5C Charles Alan Wright, et al., Federal Practice and Procedure § 8388 (3d ed. 2012). In the decade after Bivens, however, the Supreme Court applied the case in only two new contexts—“one under the Fifth Amendment against members of Congress for employment discrimination on the basis of sex and one under the Eighth Amendment against federal prison officials for failure to provide adequate medical care.” Loumiet, 948 F.3d at 380 (citing Davis v. Passman, 442 U.S. 228 , 248–49 (1979); Carlson v. Green, 446 U.S. 14 , 19 (1980)). Thus, “the Supreme Court has carefully circumscribed Bivens and ‘consistently refused to extend Bivens to any new context or new category of defendants.’” Id. (citing Ziglar v. Abbasi, 137 S. Ct. 1843 , 1857 (2017)). When presented with a Bivens claim, a court “must consider whether the plaintiff seeks to extend Bivens into a new context.” Loumiet, 948 F.3d at 381 (citing Abbasi, 137 S. Ct. at 1857– 60) (internal quotation marks omitted). If so, the court should then consider “whether there are any special factors counselling hesitation,” id., given the Supreme Court’s admonition that “expanding the Bivens remedy is now considered a ‘disfavored’ judicial activity,” Abbasi, 137 S. Ct. at 1857 (quoting Iqbal, 556 U.S. at 675 ). “The new-context inquiry . . . is straightforward.” Loumiet, 948 F.3d at 381. The court asks whether “[a] case is different in a meaningful way from previous Bivens cases decided.” Abbasi, 137 S. Ct. at 1859. Here, Plaintiff claims the VA retaliated against him by violating his 7 First Amendment right to freedom of speech and to petition the government to redress his grievances. The Supreme Court has never applied Bivens to a First Amendment retaliation claim. Thus, Plaintiff’s claim presents a new context for a Bivens analysis. Next, the court considers whether there are any special factors counseling hesitation in expanding Bivens. One such factor is whether an “alternative, existing process for protecting the interest amounts to a convincing reason for the Judicial Branch to refrain from providing a new and freestanding remedy in damages.” Wilkie v. Robbins, 551 U.S. 537 , 550 (2007). The Supreme Court has held that when there are “comprehensive procedural and substantive provisions giving meaningful remedies against the United States,” a Bivens remedy is not appropriate. See Bush v. Lucas, 462 U.S. 367 , 368 (1983). Here, the Civil Service Reform Act, “a comprehensive system for reviewing personnel action[s] taken against federal employees.” United States v. Fausto, 484 U.S. 439 , 455 (1988), provides an alternate provision under which Plaintiff could seek redress. Plaintiff has already submitted a complaint to the VA’s Office of Accountability and Whistleblower Protection alleging “prohibited personnel practice.” (Compl. ¶ 10.) He has not, however, filed an action with the Office of Special Counsel, who can “receive and investigate allegations of prohibited personnel practices” pursuant to the Civil Service Reform Act. 5 U.S.C. § 1212 . Because Plaintiff has already taken advantage of one process and may avail himself of an alternative process (which he has not yet even attempted to utilize) that would address his complaints, “it would be inappropriate for this Court to supplement that regulatory scheme with a new 8 nonstatutory damages remedy.” Bush, 462 U.S. at 367 . Thus, the court declines Plaintiff’s invitation to expand Bivens into a new context. 3 Plaintiff argues in his opposition brief that Defendants have mischaracterized his claims and that he may still seek “equitable relief” under Bivens. (ECF No. 15, Pl. Opp’n at 16.) The court is not persuaded. Equitable relief is not available to a plaintiff in a Bivens action. See Kauffman v. Anglo-Am. Sch. of Sofia, 28 F.3d 1223 , 1225 (D.C. Cir. 1994) (“[S]ince the [plaintiffs] continued to seek only damages and not any equitable relief, their federal claims thus rested on Bivens”). Bivens claims involve “suing federal officials in their individual capacities for money damages,” not equitable relief. 5C Charles Alan Wright, et al., Federal Practice and Procedure § 8388 (3d ed. 2012) (emphasis supplied). Furthermore, Plaintiff’s request for equitable relief presents a new theory that does not appear in the Complaint. See Briscoe v. Costco Wholesale Corp., 61 F. Supp. 3d 78 , 83 n.2 (D.D.C. 2014) (“An opposition brief cannot be used to put forth new allegations and legal theories, and as such, the Court must ignore those facts for the purposes of deciding [the plaintiff’s] motion”). Even assuming Plaintiff’s Complaint can be construed to plead a free-standing First Amendment retaliation claim for equitable relief, his allegations fall short of stating a valid claim. To bring a First Amendment retaliation claim, a plaintiff must show that: (1) “he engaged in conduct protected under the First Amendment; (2) the defendant took some retaliatory action sufficient to deter a person of ordinary firmness in plaintiff’s position from speaking again; and (3) a causal link between the exercise of a constitutional right and the adverse action taken 3 Defendants Hardy, Artis, and Staton also claim that they are entitled to qualified immunity. The court need not decide this issue because it has already found that Plaintiff has not pleaded a Bivens claim which entitles him to relief. See Loumiet, 948 F.3d at 380. 9 against him.” Aref v. Lynch, 833 F.3d 242 , 259 (D.C. Cir. 2016); see also Pinson v. U.S. Dep’t of Just., 246 F. Supp. 3d 211 (D.D.C. 2017) (applying same standard to a Bivens claim for First Amendment retaliation). The allegations in the Complaint fail to demonstrate that Plaintiff engaged in protected speech. Plaintiff appears to assume that a congressional complaint, a complaint filed with the VA whistleblower’s office, and a letter to the D.C. Metropolitan Police Department in support of a terminated employee under investigation constitute protected speech. Circuit precedent says otherwise. Speech “relating to [a] matter of political, social, or other concern to the community” is protected, while speech about “individual personnel disputes and grievances . . . [that is] of no relevance to the public’s evaluation of the performance of governmental agencies” is not. LeFande v. District of Columbia, 613 F.3d 1155 , 1159, 1161 (D.C. Cir. 2010). Plaintiff has not asserted facts establishing that his complaints about his employment and medical leave related to a matter of public concern as opposed to a personnel dispute. See, e.g., Connick v. Myers, 461 U.S. 138 , 148 (1983) (finding that the “confidence and trust” the district attorney’s staff members had in their supervisors was not of public concern, nor was “the level of office morale,” nor “the need for a grievance committee”); Barnes v. Small, 840 F.2d 972 , 982 (D.C. Cir. 1988) (finding that alleged assaults and false statements made with the Army’s Military Traffic Management Command were not of public concern because the allegations “addressed only the misbehavior of other employees . . . not matters relating to any broader public interest”); Murray v. Gardner, 741 F.2d 434 , 438 (D.C. Cir. 1984) (explaining that an FBI practice of furloughing agents by lottery merely amounted to “the quintessential employee beef: 10 management has acted incompetently,” and was therefore not protected speech). 4 And while the D.C. Circuit has found that “procedural irregularities that [] affect an integral component of police service” may be relevant to the public’s evaluation of its police department, LeFande, 613 F.3d at 1161 , Plaintiff has not shown that the reassignment of supervisory duties at the VA police department rises to a public concern. Based on the allegations in the Complaint, Plaintiff has not presented an actionable First Amendment retaliation claim. C. Fifth Amendment Due Process Claim In Count II, Plaintiff alleges that Defendants violated his Fifth Amendment due process rights by “creating an Acting Deputy Chief of Police position . . . and removing Plaintiff’s duties as the Deputy Chief of Police and giving his duties to Defendant Artis.” (Id. ¶ 27.) 5 “The Fifth Amendment Due Process Clause protects individuals from deprivations of ‘life, liberty, or property, without due process of law.’” Atherton v. D.C. Office of Mayor, 567 F.3d 672 , 689 (D.C. Cir. 2009) (citing U.S. Const. amend. V). A procedural due process violation—the type alleged here—“occurs when an official deprives an individual of a liberty or property interest without providing appropriate procedural protections.” Id. Thus, to establish a viable due process violation, a plaintiff must first identify a valid constitutional interest. 4 In contrast, the Supreme Court has found that speech that implicates a public concern includes the allocation of funds between education and athletic programs, Pickering v. Bd. of Ed., 391 U.S. 563 , 569 (1968); a school district’s allegedly racially discriminatory policies, Givhan v. W. Line Consolidated Sch. Dist., 439 U.S. 410 (1979); whether a college should be elevated to four- year status, Perry v. Sindermann, 408 U.S. 593 (1972); and whether a public school should adopt a dress code for teachers, Mt. Healthy City Bd. of Ed. v. Doyle, 429 U.S. 274 (1977). 5 Defendants treat Count II as another Bivens claim, but the court reads it as a free-standing due process claim. 11  Plaintiff argues that he was deprived of his right to continued federal employment by virtue of an “adverse employment action” and consequently suffered “reputational harm/defamation.” (Compl. ¶ 26.) 6 The problem for Plaintiff is that he was not subject to an adverse employment action that gives rise to a constitutional claim. Based on his own allegations, “Defendant[s] violated [his] Fifth Amendment rights by . . . removing Plaintiff’s duties as the Deputy Chief of Police and giving his duties to Defendant Artis.” (Compl. ¶ 27.) However, there is “no protected property interest [] implicated when an employer reassigns or transfers an employee absent a specific statutory provision or contract term to the contrary.” Anglemyer v. Hamilty Cnty. Hosp., 58 F.3d 533 , 539 (10th Cir. 1995); see also McDonald v. Salazar, 831 F. Supp. 2d 313 , 321 (D.D.C. 2011) (finding that “a mere change in duties” did not deprive a plaintiff of his constitutional right to his job); Humberson, 236 F. Supp. 2d at 31 (refusing to recognize as a deprivation of a property interest a reassignment that precluded plaintiff from performing certain tasks that he previously performed). Relying on the Supreme Court’s decision in Cleveland Board of Education v. Loudermill, Plaintiff argues that the Fifth Amendment protects him from having his responsibilities and supervisory duties removed without due process. (Pl. Opp’n at 19 (citing 470 U.S. 532 ).) Loudermill did not so hold, however. In that case, the Supreme Court found that a terminated employee was entitled to a limited administrative hearing before his termination. 470 U.S. at 542 (requiring that the government provide “some kind of a hearing” prior to the discharge of an 6 Defendants assert, and Plaintiff does not dispute, that Plaintiff is covered by the Civil Service Reform Act. “The existence of these protections has led courts to conclude that Competitive Service employees possess a legitimate expectancy of, and therefore a property interest in, continued federal employment.” Humberson v. U.S. Att’y’s Office for Dist. of Columbia, 236 F. Supp. 2d 28 , 31 (D.D.C. 2003), aff’d, No. 03-5073, 2003 WL 21768064 (D.C. Cir. July 16, 2003) (citing Buchholz v. Aldaya, 210 F.3d 862 , 867 (8th Cir. 2000); Stone v. FDIC, 179 F.3d 1368 , 1375 (Fed. Cir. 1999)). 12 employee who has a constitutionally protected property interest in his employment.) Since Plaintiff was not terminated from his position at the VA, Loudermill provides little support for his due process claim. Accordingly, Count II of the Complaint will be dismissed. D. FMLA Claim Plaintiff also alleges that the VA violated his rights under the FMLA, 7 which entitles eligible employees to twelve weeks of unpaid leave during any twelve-month period if a “serious health condition” prevents the employee from performing the functions of his position. 29 U.S.C. § 2612 (a)(1)(D). There are two distinct claims under the FMLA: “(1) interference, if the employer restrained, denied, or interfered with the employee’s FMLA rights, and (2) retaliation, if the employer took adverse action against the employee because the employee took leave or otherwise engaged in activity protected by the Act.” Vick v. Brennan, 172 F. Supp. 3d 285 , 303 (D.D.C. 2016). Plaintiff alleges both. (Compl. ¶¶ 34.) The court finds that Plaintiff has failed to proffer facts sufficient to support his FMLA claims. Therefore, both claims will be dismissed pursuant to Rule 12(b)(6). 1. Interference To prevail on an FMLA interference claim, a plaintiff must show that his employer “interfered with, restrain[ed], or denied the exercise of or the attempt to exercise any right provided by the FMLA and that []he was prejudiced thereby.” Gordon v. U.S. Capitol Police, 7 The court agrees with Defendants that the FMLA claims may only proceed against the VA, which is represented by its Secretary, Wilkie. See 29 U.S.C. § 2611 (4)(A)(i) (defining an employer as a “person engaged in commerce or in any industry or activity affecting commerce who employs 50 or more employees”). Thus, to the extent Plaintiff seeks to bring an FMLA claim against Artis, Hardy, and Staton, those claims fail. 13  778 F.3d 158 , 164 (D.C. Cir. 2015). Plaintiff alleges that the VA interfered with his rights under FMLA by failing to approve his leave. (Compl. ¶ 34.) But Plaintiff also appears to acknowledge in his Complaint that he took his leave and that the leave was approved. (See id. ¶ 18–19) (noting that the someone from the VA Medical Center called him while he was on leave and discussed his return). Modifying his argument in his opposition brief, Plaintiff now claims that Defendants interfered with his FMLA leave by filing a false Privacy Act violation against him and ordering him to respond to it within seventy-two hours, while he was on leave. (Pl. Opp’n. at 11.) Such actions, in his view, effectively discouraged him from taking his leave, and thus constitute interference in violation of the FMLA. (Id.) Even if this conduct amounted to an interference, Plaintiff “fails to identify evidence of prejudice arising by reason of the violation or as a direct result of the violation.” Waggel v. George Washington Univ., 957 F.3d 1364 , 1377 (D.C. Cir. 2020) (internal quotation marks omitted). A finding of prejudice is crucial to Plaintiff’s claim because “[r]emedies for FMLA interference claims are ‘tailored to the harm suffered.’” Id. While Plaintiff claims that “Artis and Hardy [] triggered the false Privacy Act violation investigation against Plaintiff to justify his removal from his position,” (Pl. Opp’n at 13), he was never terminated from his position. Nor was he demoted, suspended, or disciplined. (Id. at 15.) And he fails to allege any other type of harm. See, e.g., Gordon, 778 F.3d at 166 (finding that allegations of monetary losses and harms to future career prospects sufficiently demonstrated prejudice to survive a motion to dismiss of an FMLA interference claim). Because Plaintiff has not sufficiently alleged prejudice resulting from the Privacy Act accusation, he cannot establish interference in violation of FMLA. 14  2. Retaliation The prima facie elements of an FMLA retaliation claim are that the employee “(1) engaged in a protected activity for purposes of the statute; (2) suffered an adverse employment action, and (3) that the protected activity and the adverse employment action were causally connected.” Gordon, 778 F.3d at 161. An adverse employment action is “a significant change in employment status, such as hiring, firing, failing to promote, reassignment with significantly different responsibilities, or a decision causing significant change in benefits.” Douglas v. Donovan, 559 F.3d 549 , 552 (D.C. Cir. 2009) (quoting Taylor v. Small, 350 F.3d 1286 , 1293 (D.C. Cir. 2003)). The action must affect “the terms, conditions, or privileges of employment or future employment opportunities such that a reasonable trier of fact could find objectively tangible harm.” Forkkio v. Powell, 306 F.3d 1127 , 1131 (D.C. Cir. 2002). A “tangible employment action in most cases inflicts direct economic harm.” Douglas, 559 F.3d at 552 (quoting Burlington Indus., Inc. v. Ellerth, 524 U.S. 742 , 762 (1998)). The court cannot identify a plausible FMLA retaliation claim based on the scarce factual allegations in the Complaint. First, Plaintiff claims that Hardy and Artis accusing him of a Privacy Act violation and requiring him to respond as he was about to take medical leave constitutes an adverse employment action. The accusation of a Privacy Act violation alone, so far as the court can tell based on the allegations in the Complaint, did not result in a change in Plaintiff’s employment status or economic injury. And though “[a]n employer can effectively retaliate against an employee by taking actions not directly related to his employment or by causing him harm outside the workplace,” Burlington N. & Santa Fe Ry. Co. v. White, 548 U.S. 53 , 63 (2006), it is not clear from the Complaint what harm Plaintiff suffered by being required to respond to the 15 violation in seventy-two hours. Without more context, the court is unable to determine what type of response was required, how long it would have taken, or what the penalty was for failing to respond. Accordingly, Plaintiff has failed to identify a materially adverse employment action to support a plausible retaliation claim based on the Privacy Act investigation. Second, Plaintiff claims “Defendant Hardy removed Plaintiff Lindsay from his position as the Deputy Chief of Police. Defendant Artis, with the knowledge and consent of Defendant Hardy and Defendant Staton, moved into [Plaintiff]’s office and removed [his] name from the door, and removed Plaintiff from various databases in the Police Service.” (Compl. ¶ 34.) Given the alleged facts, it is unclear whether these acts qualify as an adverse employment action, particularly where none of the supposed “removals” affected the terms and conditions of Plaintiff’s employment. See Powell, 306 F.3d at 1131 (holding that “an employee suffers an adverse employment action if he experiences materially adverse consequences affecting the terms, conditions, or privileges of employment” such as pay, benefits, or substantive responsibilities). In his opposition brief, Plaintiff attempts to clarify his argument and alleges that “Defendants removed Plaintiff from his position with supervisory duties.” (See Pl. Opp’n at 14.) To be sure, “withdrawing an employee’s supervisory duties . . . constitutes an adverse employment action.” Czekalski v. Peters, 475 F.3d 360 , 362 (D.C. Cir. 2007). 8 But the Complaint indicates that Defendants had already reassigned Plaintiff’s supervisory duties before he requested FMLA leave. (Compl. ¶ 23) (alleging that Defendant Hardy reassigned all of 8 Czekalski arose in the context of a Title VII retaliation claim. However, its analysis is persuasive because the D.C. Circuit has recognized an “overwhelming consensus” among the federal Circuits that an FMLA retaliation claim is governed by the standard applicable to claims brought under the retaliation provision of Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e-3. Gordon, 778 F.3d at 162. 16 Plaintiff’s duties as the Deputy Chief of Police in January 2019); (id. ¶ 34) (explaining that Plaintiff submitted his FMLA leave request in February 2019). Thus, Plaintiff has failed to adequately plead a causal connection between the reassignment of his supervisory duties and his request for FMLA leave. III. CONCLUSION For the foregoing reasons, Defendants’ motion to dismiss the Complaint is GRANTED. The court has already issued an accompanying order. Date: December 1, 2020 Tanya S. Chutkan TANYA S. CHUTKAN United States District Judge 17

2020-12-02 01:00:54.846002+00

http://cdn.ca9.uscourts.gov/datastore/bap/2020/12/01/Rickert Memorandum 20-1100.pdf

FILED DEC 1 2020 NOT FOR PUBLICATION SUSAN M. SPRAUL, CLERK U.S. BKCY. APP. PANEL OF THE NINTH CIRCUIT UNITED STATES BANKRUPTCY APPELLATE PANEL OF THE NINTH CIRCUIT In re: BAP No. MT-20-1100-BGF LEILANI HOPE RICKERT, Debtor. Bk. No. 2:18-bk-60937-BPH LEILANI HOPE RICKERT, Adv. No. 1:20-ap-01003-BPH Appellant, v. MEMORANDUM* SPECIALIZED LOAN SERVICING, LLC; BENJAMIN J. MANN; BRIAN J. PORTER; NATALIE E. LEA; MUKTA SURI; FEDERAL HOME LOAN MORTGAGE CORPORATION, Appellees. Appeal from the United States Bankruptcy Court for the District of Montana Benjamin P. Hursh, Chief Bankruptcy Judge, Presiding Before: BRAND, GAN, and FARIS, Bankruptcy Judges. INTRODUCTION Appellant Leilani Hope Rickert appeals an order dismissing her adversary complaint on a motion filed by appellees Specialized Loan * This disposition is not appropriate for publication. Although it may be cited for whatever persuasive value it may have, see Fed. R. App. P. 32.1, it has no precedential value, see 9th Cir. BAP Rule 8024-1. Servicing, LLC ("SLS"), SLS attorneys Benjamin J. Mann, Brian J. Porter, Natalie E. Lea and Mukta Suri, and the Federal Home Loan Mortgage Corporation (collectively, "Appellees"). We AFFIRM. I. FACTUAL BACKGROUND AND PROCEDURAL HISTORY This is Rickert's second attempt to challenge SLS's standing to enforce its security interest in her home.1 SLS was the servicer of the mortgage loan, after receiving an assignment of the note and deed of trust from the original lender, SunTrust Mortgage. In this action, Rickert also alleged claims against SLS's attorneys relating to their representation of SLS in the prior dispute over SLS's proof of claim. Rickert filed her chapter 132 bankruptcy case on October 2, 2018. During the case, she objected to SLS's secured proof of claim and its motion to modify the automatic stay under § 362. Rickert contended that SLS was not the holder of the note and therefore had no standing to enforce the note or the deed of trust. Following an evidentiary hearing, where a SLS witness testified that she was in physical possession of the original note and deed of trust, the bankruptcy court overruled Rickert's claim objection, concluding that SLS was the party entitled to enforce the note and granting SLS stay relief to 1 For more background of this case, see Rickert v. Specialized Loan Servicing, LLC (In re Rickert), BAP No. MT-19-1120-LBG, 2020 WL 1170732 (9th Cir. BAP Mar. 9, 2020). 2 Unless specified otherwise, all chapter and section references are to the Bankruptcy Code, 11 U.S.C. §§ 101-1532 , all "Rule" references are to the Federal Rules of Bankruptcy Procedure, and all "Civil Rule" references are to the Federal Rules of Civil Procedure. 2 pursue its non-bankruptcy remedies under the deed of trust. Rickert appealed. The BAP affirmed. Three days before the BAP entered its decision in the first appeal, Rickert filed a complaint against Appellees. Of those claims that were cognizable, Rickert alleged that SLS had no valid security interest in her home because SLS never "validated" the debt or produced an original note or deed of trust. As a result, alleged Rickert, SLS lacked standing to enforce the note. Rickert also alleged that SLS's attorneys conspired with SLS to defraud her and the court by filing false proofs of claims, loan documents and mortgage assignments, and by making false representations of fact. Attached to Rickert's complaint was a copy of a "Chain of Title Analysis & Mortgage Investigation" prepared for Rickert in December 2019 by a private investigator.3 Appellees moved to dismiss Rickert's complaint under Civil Rule 12(b)(6), arguing that it failed to state any plausible claims for relief ("Motion to Dismiss"). In general, argued Appellees, the complaint did not include any specified causes of action but rather consisted of vague, conclusory assertions pertaining to the real estate transaction. Further, most or all of Rickert's claims had been adjudicated by the bankruptcy court and affirmed by the BAP; thus, they were barred by law of the case or claim preclusion. Appellees 3 The BAP declined to consider this document in the first appeal because it was not before the bankruptcy court at the time it ruled on Rickert's claim objection and SLS's request for stay relief. 3 argued that Rickert's fraud and conspiracy-related claims failed because she did not plead them with the particularity required under Civil Rule 9(b), and her alleged claims for unjust enrichment and RICO failed because she did not articulate any factual basis for them. Finally, Appellees argued that Rickert's remaining claims for bankruptcy crimes and other federal crimes failed because her "scattershot, kitchen sink" approach deprived them of any ability to understand and respond to them. Appellees filed a certificate of service on March 18, 2020, stating that Rickert was served with the Motion to Dismiss on that date. On March 19, 2020, Appellees filed a Notice of Opportunity to Respond and Request for Hearing ("Notice") and an amended certificate of service stating that Rickert was served with both the Notice and Motion to Dismiss on March 18, 2020. The Notice provided, if Rickert objected to the Motion to Dismiss, she was to file her written opposition and request a hearing within 14 days of the date of the Notice and Motion to Dismiss. On April 1, 2020, Rickert filed an opposition to the Motion to Dismiss and requested a hearing for April 28, 2020. She argued that SLS's proof of claim failed due to insufficient documentation, and the new evidence contained in the Chain of Title Analysis & Mortgage Investigation and supporting affidavit demonstrated that SLS had no interest in the note. Thus, argued Rickert, SLS had no standing to file a proof of claim or to move to dismiss her complaint. Rickert also objected to the certificates of service, 4 arguing that the Notice and Motion to Dismiss were actually mailed to her on March 19, not March 18. Consequently, argued Rickert, the 14-day clock should not have started running until March 19, giving her until April 2 to file her opposition. Contrary to her request for an April 28 hearing date, Rickert requested in her opposition that the court rule on the Motion to Dismiss "without a hearing" due to the COVID-19 pandemic and the governor's Stay-at-Home Directive issued on March 26, 2020. On April 9, 2020, without a hearing, the bankruptcy court entered an order granting the Motion to Dismiss, dismissing Rickert's complaint with prejudice, and vacating the April 28 hearing. The court found that Rickert's complaint failed to comply with the pleading standards set forth in Ashcroft v. Iqbal, 556 U.S. 662 (2009), and Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007). The court also found that Rickert could not plausibly establish any entitlement to relief because her claims were barred by law of the case. The cognizable claims raised in the complaint — SLS's standing to enforce the note and related fraud claims — were a reassertion of the very claims and arguments she raised in her objection to SLS's proof of claim that had already been explicitly and implicitly adjudicated by the court and the BAP. The court did not allow Rickert to amend the complaint because no amendment would cure its deficiencies. This timely appeal followed.4 //// 4 The bankruptcy court dismissed Rickert's chapter 13 case on June 2, 2020. 5  II. JURISDICTION The bankruptcy court had jurisdiction under 28 U.S.C. §§ 1334 and 157(b)(2)(K). We have jurisdiction under 28 U.S.C. § 158 . III. ISSUES 1. Did the bankruptcy court err in dismissing Rickert's complaint? 2. Did the bankruptcy court abuse its discretion in denying Rickert leave to amend? IV. STANDARDS OF REVIEW We review de novo the bankruptcy court's grant of a Civil Rule 12(b)(6) motion to dismiss. Movsesian v. Victoria Versicherung AG, 670 F.3d 1067 , 1071 (9th Cir. 2012). In considering a motion to dismiss under Civil Rule 12(b)(6), all well-pleaded factual allegations in the complaint must be accepted as true and construed in the light most favorable to the plaintiff. Johnson v. Riverside Healthcare Sys., LP, 534 F.3d 1116 , 1122 (9th Cir. 2008). We review the bankruptcy court's dismissal of a complaint without leave to amend and with prejudice for abuse of discretion. Tracht Gut, LLC v. L.A. Cty. Treasurer & Tax Collector (In re Tracht Gut, LLC), 836 F.3d 1146 , 1150 (9th Cir. 2016) (citing AE ex rel. Hernandez v. Cty. of Tulare, 666 F.3d 631 , 636 (9th Cir. 2012)). A bankruptcy court abuses its discretion if it applies the wrong legal standard, or misapplies the correct legal standard, or if it makes factual findings that are illogical, implausible, or without support in inferences that may be drawn from the facts in the record. United States v. 6 Hinkson, 585 F.3d 1247 , 1262 (9th Cir. 2009) (en banc). V. DISCUSSION A. Standards for Civil Rule 12(b)(6) Under Civil Rule 12(b)(6), applicable here by Rule 7012, dismissal is proper if a complaint fails to allege "enough facts to state a claim to relief that is plausible on its face." Twombly, 550 U.S. at 570 . While detailed factual allegations are not required, mere labels and conclusions or a formulaic recitation of the elements of a cause of action are not enough. Iqbal, 556 U.S. at 678 . The Ninth Circuit has summarized the governing standard, in light of Twombly and Iqbal, as follows: "In sum, for a complaint to survive a motion to dismiss, the non-conclusory factual content, and reasonable inferences from that content, must be plausibly suggestive of a claim entitling the plaintiff to relief." Moss v. U.S. Secret Serv., 572 F.3d 962 , 969 (9th Cir. 2009) (internal quotation marks and citation omitted). Apart from factual insufficiency, a complaint is also subject to dismissal under Civil Rule 12(b)(6) where it lacks a cognizable legal theory, Balistreri v. Pacifica Police Dep't, 901 F.2d 696 , 699 (9th Cir. 1990), or where the allegations on their face "show that relief is barred" for some legal reason, Jones v. Bock, 549 U.S. 199 , 215 (2007). The pleading of a pro se litigant is held to a less stringent standard than a pleading drafted by an attorney, and is afforded the benefit of any doubt. Hebbe v. Pliler, 627 F.3d 338 , 342 (9th Cir. 2010). Further, a pro se litigant must 7 be given leave to amend unless it is absolutely clear that the complaint's deficiencies cannot be cured by amendment. Lucas v. Dep't of Corr., 66 F.3d 245 , 248 (9th Cir. 1995). When ruling on a Civil Rule 12(b)(6) motion to dismiss, if the bankruptcy court considers evidence outside the pleadings, it must normally convert the motion into one for summary judgment under Civil Rule 56 and give the nonmoving party an opportunity to respond. United States v. Ritchie, 342 F.3d 903 , 907 (9th Cir. 2003). "A court may, however, consider certain materials — documents attached to the complaint, documents incorporated by reference in the complaint, or matters of judicial notice — without converting the motion to dismiss into a motion for summary judgment." Id. at 908 . B. The bankruptcy court did not err in dismissing Rickert's complaint. Rickert raises several arguments on appeal, which we address in turn. We first consider her arguments regarding due process and alleged technical defects in the Motion to Dismiss. Rickert argues that the bankruptcy court denied her due process by dismissing her complaint without a hearing. This argument lacks merit. Rickert specifically requested that the court rule on the Motion to Dismiss "without a hearing" given the governor's current Stay-at-Home Directive and the lengthy drive from her home to the courthouse. Thus, we fail to see how Rickert was denied due process when she got exactly what she asked for. In 8 any case, Rickert had, and took, the opportunity to file an opposition to the Motion to Dismiss, and the court considered it. See Mullane v. Cent. Hanover Bank & Tr. Co., 339 U.S. 306 , 314 (1950) (fundamental question for due process is whether appellant received any type of notice that was reasonably calculated under all the circumstances to apprise it of the pendency of the action and afford it an opportunity to present an objection). In what also appears to be a due process argument, Rickert contends the bankruptcy court erred by considering the "extrinsic evidence" of the BAP's decision in the first appeal, which affirmed the bankruptcy court's rulings that SLS was the party entitled to enforce the note and could pursue its non-bankruptcy remedies under the deed of trust. The BAP's decision is not "extrinsic evidence" but rather is a matter of public record of which the bankruptcy court could take judicial notice. And the court's doing so did not convert the Motion to Dismiss to one for summary judgment requiring notice and an opportunity to respond. Ritchie, 342 F.3d at 908 ; Mack v. S. Bay Beer Distrib., Inc., 798 F.2d 1279 , 1282 (9th Cir. 1986) ("On a motion to dismiss . . . a court may take judicial notice of facts outside the pleadings. . . . Therefore, on a motion to dismiss a court may properly look beyond the complaint to matters of public record and doing so does not convert a Rule 12(b)(6) motion to one for summary judgment.") (citations, quotations, and footnote omitted), overruled on other grounds by Astoria Fed. Sav. & Loan Ass'n v. Solimino, 501 U.S. 104 (1991). 9  Rickert next argues that the Motion to Dismiss suffered from various defects including improper service. The bankruptcy court did not address this argument. Rickert argues that the Notice and Motion to Dismiss were mailed to her on March 19, not March 18 as counsel for SLS had represented, and therefore the Motion to Dismiss should have been "dismissed" for not complying with Local Bankruptcy Rules 1017-1(c) and 9013-1(e), "Montana Code Annotated Rule 5," and Civil Rule 12(b)(4) and (5). Even if factually correct, the authority Rickert cites does not help her. Local Bankruptcy Rule 9013-1(e) provides generally that motions must state conspicuously that any opposition is to be filed within 14 days of the motion, which is what the Motion to Dismiss stated. Local Bankruptcy Rule 1017-1(c) applies to the dismissal or conversion of bankruptcy cases based on a debtor's default under a confirmed plan. It has nothing to do with the dismissal of an adversary proceeding. No Montana service rule would apply here, since the bankruptcy court is a federal court with its own rules of civil procedure. Rickert's reliance on Civil Rule 12(b)(4) and (5) to dismiss the Motion to Dismiss is also misplaced; one does not respond to a Civil Rule 12(b) motion with a Civil Rule 12(b) motion. To the extent Rickert argues that she should have had until April 2 to file an opposition based on an alleged service date of March 19, Rickert offers no different or additional arguments she could have raised had she filed it on April 2 instead of when she did file it, April 1. Therefore, Rickert has not 10 established that she was prejudiced by the alleged service defect. See Rosson v. Fitzgerald (In re Rosson), 545 F.3d 764 , 775-77 (9th Cir. 2008) (inadequate notice is harmless error unless the appellant demonstrates prejudice). Lastly, Rickert argues that the bankruptcy court erred by ignoring her new evidence of the Chain of Title Analysis & Mortgage Investigation, which she claims proves that SLS lacked standing to enforce the note and deed of trust. Citing to Rule 3001 (regarding proofs of claim), Rickert argues that SLS's proof of claim was not supported with proper documentation and was invalid and fraudulent. These are the precise issues that the bankruptcy court previously decided, both explicitly and implicitly, in favor of SLS and that the BAP affirmed in the first appeal. As such, these issues are barred by the doctrine of law of the case. See Rebel Oil Co. v. Atl. Richfield Co., 146 F.3d 1088 , 1093 (9th Cir. 1998) ("Under the doctrine of 'law of the case,' a court is generally precluded from reconsidering an issue that has already been decided by the same court, or a higher court in the identical case.").5 To the extent Rickert raised new claims against SLS or raised new 5 We also note that the Chain of Title Analysis & Mortgage Investigation was not "newly discovered evidence" even if the bankruptcy court construed Rickert's complaint as a motion for relief from the claim objection order under Civil Rule 60(b)(2). While this report may have contained "new" evidence in Rickert's opinion, the information upon which the report exclusively relied was available to Rickert prior to the evidentiary hearing. "Evidence 'in the possession of the party before the judgment was rendered is not newly discovered.'" Feature Realty, Inc. v. City of Spokane, 331 F.3d 1082 , 1093 (9th Cir. 2003) (quoting Coastal Transfer Co. v. Toyota Motor Sales, U.S.A., 833 F.2d 208 , 212 (9th Cir. 1987)). 11 claims against new defendants, namely counsel for SLS, these claims lacked any factual basis and stemmed entirely from Rickert's previous assertions that SLS defrauded her and the court in the litigation over SLS's proof of claim and stay relief. The bankruptcy court and the BAP already addressed and decided the issue of any alleged fraud by SLS in those matters and found none. Hence, these new claims against SLS were barred by either law of the case or claim preclusion. See Mpoyo v. Litton Electro-Optical Sys., 430 F.3d 985 , 987 (9th Cir. 2005) (federal claim preclusion bars second suit when first suit: (1) involved the same claim or cause of action as the second suit; (2) reached a final judgment on the merits; and (3) involved identical parties or privies). And given that SLS's counsel did nothing more than duties typically performed by lawyers in their representation of SLS in the prior action, any claims against them were barred by claim preclusion. See id.; Plotner v. AT & T Corp., 224 F.3d 1161 , 1169 (10th Cir. 2000) (defendant attorneys appearing by virtue of their activities as representatives of parties in prior suit created privity); Henry v. Farmer City State Bank, 808 F.2d 1228 , 1235 n.6 (7th Cir. 1986) (holding that for claim preclusion purposes, privity exists between a party and its attorneys; barring RICO claims against attorneys in second suit). Because Rickert's complaint was nothing more than an attempt to repeat the same allegations and arguments that were already decided against her, or to raise new claims she failed to raise before, the bankruptcy court did not err in dismissing it. 12 C. The bankruptcy court did not abuse its discretion in denying Rickert leave to amend. "Dismissal of a pro se complaint without leave to amend is proper only if it is absolutely clear that the deficiencies of the complaint could not be cured by amendment." Schucker v. Rockwood, 846 F.2d 1202 , 1203-04 (9th Cir. 1988) (per curiam) (internal quotation marks and citations omitted); see also Lucas, 66 F.3d at 248 . Rickert did not request an opportunity to amend her complaint before the bankruptcy court. She does not contend that the court should have allowed her to amend her complaint nor does she suggest what amendment she would make had she been allowed to do so. However, given that her claims are barred as a matter of law, any deficiencies of her complaint could not be cured by amendment. See Jones, 549 U.S. at 215 (a complaint is subject to dismissal under Civil Rule 12(b)(6) where the allegations on their face are barred for some legal reason). Accordingly, the bankruptcy court did not abuse its discretion in dismissing Rickert's complaint without leave to amend. VI. CONCLUSION For the reasons stated above, we AFFIRM. 13

2020-12-02 01:00:54.990395+00

http://cdn.ca9.uscourts.gov/datastore/bap/2020/12/01/Schaefers Memo 20-1067.pdf

FILED DEC 1 2020 NOT FOR PUBLICATION SUSAN M. SPRAUL, CLERK U.S. BKCY. APP. PANEL OF THE NINTH CIRCUIT UNITED STATES BANKRUPTCY APPELLATE PANEL OF THE NINTH CIRCUIT In re: BAP No. CC- 20-1067-SGL BERND SCHAEFERS, Debtor. Bk. No. 9:19-bk-11163-MB BERND SCHAEFERS, Appellant, v. MEMORANDUM* BLIZZARD ENERGY, INC.; FRANZISKA SHEPARD, Appellees. Appeal from the United States Bankruptcy Court for the Central District of California Martin R. Barash, Bankruptcy Judge, Presiding Before: SPRAKER, GAN, and LAFFERTY, Bankruptcy Judges. INTRODUCTION Chapter 71 debtor Bernd Schaefers appeals from the bankruptcy court’s denial of his homestead exemption claim – asserted not in any real property but in a limited liability company known as BKS Cambria LLC * This disposition is not appropriate for publication. Although it may be cited for whatever persuasive value it may have, see Fed. R. App. P. 32.1, it has no precedential value, see 9th Cir. BAP Rule 8024-1. 1 Unless specified otherwise, all chapter and section references are to the Bankruptcy Code, 11 U.S.C. §§ 101-1532 . (“LLC”), which he owns with his wife. The LLC owns real property located in Cambria, California (“Property”), where Schaefers has lived since 2014. Schaefers relies on a state court ruling, which held that the LLC is liable under a reverse alter ego theory for the individual debt he owes to his largest creditor. In other words, Schaefers argues that the reverse alter ego ruling based on his inequitable conduct establishes his “equitable” interest in the Property and establishes his right to claim a homestead exemption in it under California law. It does not. Schaefers’ argument runs contrary to the equitable purpose underlying alter ego doctrine: to extend liability beyond a debtor to avoid injustice. To recognize a homestead exemption in the Property owned by the LLC Schaefers created would reward him for the inequitable conduct that warranted extension of his individual liability to the LLC. Because he has not established an interest in the Property sufficient to support a homestead exemption, we AFFIRM. FACTS In July 2019, Schaefers commenced his bankruptcy case by filing a voluntary chapter 11 petition. In December 2019, a chapter 11 trustee was appointed, and his case subsequently was converted to chapter 7. Schaefers’ schedules identified Blizzard Energy, Inc. (“Blizzard”) as his largest creditor, with a disputed judgment claim of $3,825,000 2 (“Blizzard Judgment”).2 Elsewhere in his schedules, he asserted that Blizzard and its principal Franziska Shepard (jointly, “Blizzard Parties”) obtained the Blizzard Judgment as a result of fraud, perjury, witness tampering, and abuse of process. He thus listed a cause of action against Shepard for the same amount as the judgment. The only other asset of significance he listed in his schedules was his 50% membership interest in the LLC, which he valued at $5,000,000.3 Schaefers did not list any interest in real property. In his original schedules, he asserted only two exemption claims: one for his automobile and another for his furniture and clothing. The bankruptcy court granted the Blizzard Parties relief from the automatic stay to proceed in the San Luis Obispo County Superior Court (“Superior Court”) with a prepetition motion to amend the Blizzard Judgment to include the LLC as an additional judgment debtor under a theory of reverse alter ego.4 The state court entered a tentative decision 2 We exercise our discretion to take judicial notice of documents electronically filed in Schaefers’ bankruptcy case. See Atwood v. Chase Manhattan Mortg. Co. (In re Atwood), 293 B.R. 227 , 233 n.9 (9th Cir. BAP 2003). 3 Schaefers later disclosed that the other 50% of the LLC is owned by his estranged wife Karin Schaefers. 4 Traditionally, courts have used alter ego liability to “hold an individual responsible for the acts of an entity.” Curci Invs., LLC v. Baldwin, 14 Cal. App. 5th 214 , 221 (2017). In this instance the Superior Court employed “reverse veil piercing” to hold the LLC liable for Schaefers’ individual debt. California recognizes that “[r]everse veil piercing is similar to traditional veil piercing in that when the ends of justice so require, (continued...) 3 detailing its reasons why it intended to hold the LLC liable for Schaefers’ individual judgment debt to the Blizzard Parties. The day after the Superior Court hearing, Schaefers amended his exemptions. As part of his amendment, Schaefers added a $175,000 exemption claim in the LLC (“LLC Exemption”) based on Cal. Code of Civil Procedure (“C.C.P.”) § 704.730 – also known as California’s automatic or “residential” homestead exemption. According to Schaefers, the Property owned by the LLC is a decommissioned U.S. Air Force base, which includes officers’ quarters consisting of a four-bedroom residence, where he has lived continuously since 2014. The Blizzard Parties timely objected to the LLC Exemption. They argued that Schaefers could not claim a homestead exemption in the LLC because he did not own the Property. As they pointed out, Schaefers’ interest was in the LLC and not the Property. They further contended that the interest in the LLC did not qualify as a dwelling under California law, 4 (...continued) a court will disregard the separation between an individual and a business entity. But, the two serve unique purposes and are used in different contexts.” Id. Though courts may need to consider additional or different factors before applying reverse veil piercing, id. at 222-24, that analysis was performed by the Superior Court and is not before us. Here, we are concerned only with the impact of the Superior Court’s decision to apply reverse piercing. To evaluate Schaefers’ contention that this reverse piercing effectively gave him an equitable interest in the LLC’s assets, we rely on traditional alter ego cases without drawing any distinction based on whose liability was extended to whom. 4 so he could not claim a homestead exemption in the LLC. The Blizzard Parties also anticipated that Schaefers would argue that he now qualified as the “owner” of the Property based on the Superior Court’s finding that the LLC was his alter ego. They maintained that the alter ego ruling could not be invoked by Schaefers as grounds for concluding that he personally owned the Property. Schaefers opposed the objection to his LLC Exemption. He reasoned that the Property qualified as a dwelling for purposes of California’s homestead exemption law by virtue of his residing there. He therefore concluded that the Blizzard Parties’ objection should be overruled. As for the fact that the LLC owned the Property rather than him, Schaefers devoted a single sentence to this issue: “A Superior Court has determined that they will recognize the LLC as Mr. Schaefers [sic] alter ego.” Schaefers attached to his opposition a declaration, which included as an exhibit a copy of the Superior Court’s tentative alter ego ruling. 5 5 The only evidence before the bankruptcy court regarding the alter ego issue was the Superior Court’s tentative ruling. On appeal, Schaefers has attempted to present as part of his appendix a number of documents that were not before the bankruptcy court, including: (1) the LLC’s Operating Agreement; (2) a non-conformed copy of the Superior Court’s tentative alter ego ruling; (3) the Superior Court’s final alter ego ruling; and (4) a 1996 Separation and Property Settlement Agreement between Schaefers and his estranged wife. We decline to consider any of these documents because they were not available for the bankruptcy court to consider. See Castro v. Terhune, 712 F.3d 1304 , 1316 n.5 (9th Cir. 2013) (citing Kirshner v. Uniden Corp. of Am., 842 F.2d 1074 , 1077 (9th Cir.1988)). Still, for purposes of this appeal, we will assume (continued...) 5  In March 2020, the bankruptcy court held a hearing on the objection to the LLC Exemption. After considering the parties’ papers and oral argument, the court sustained the objection. As the court explained, Schaefers did not own the Property. Rather, the LLC owned it. Additionally, his membership interest in the LLC was not real property in which California law would permit a judgment debtor to claim a homestead interest. The court also rejected Schaefers’ argument that the Blizzard Parties’ success in piercing the veil of the LLC to make it liable for Schaefers’ debt meant that he now owned the LLC’s assets, including the Property. On March 18, 2020, the bankruptcy court entered its order sustaining the objection to Schaefers’ homestead exemption claim. Schaefers timely appealed. JURISDICTION The bankruptcy court had jurisdiction under 28 U.S.C. §§ 1334 and 157(b)(2)(B). We have jurisdiction under 28 U.S.C. § 158 . 5 (...continued) without deciding that Schaefers established that the Superior Court reverse pierced the LLC’s veil. In their responsive brief, the Blizzard Parties moved to strike the above- referenced excerpts of record. We grant this motion for the reason stated. All of the Blizzard Parties’ other procedural objections are hereby overruled because they did not demonstrate that any of Schaefers’ other procedural missteps prejudiced them. 6  ISSUE Did the bankruptcy court commit reversible error when it disallowed Schaefers’ homestead exemption claim? STANDARD OF REVIEW A debtor’s entitlement to claim an exemption from estate property is a question of law, which we review de novo. Diaz v. Kosmala (In re Diaz), 547 B.R. 329 , 333 (9th Cir. BAP 2016) (citing Elliott v. Weil (In re Elliott), 523 B.R. 188 , 191 (9th Cir. BAP 2014)). The construction of state exemption laws also is reviewed de novo. Id. (citing Calderon v. Lang (In re Calderon), 507 B.R. 724 , 728 (9th Cir. BAP 2014). De novo review means that we consider the matter without giving any deference to the bankruptcy court’s decision. Id. DISCUSSION “When a debtor files a bankruptcy petition, all of his assets become property of the estate and may be used to pay creditors, subject to the debtor’s ability to reclaim specified property as exempt.” In re Elliott, 523 B.R. at 192 (citing Schwab v. Reilly, 560 U.S. 770 , 774 (2010)). The Bankruptcy Code provides that debtors may exempt certain “property of the estate.” § 522(b)(1). A state may choose to permit bankruptcy debtors to use the federal exemptions contained in the Bankruptcy Code in § 522(d). See 522(b)(2). Alternatively, a state may “opt out” of the exemptions provided by the Bankruptcy Code and allow their 7 debtors to use instead the exemptions provided by state law (and allowable by federal non-bankruptcy law). See §§ 522(b)(2) and (3); 4 Collier on Bankruptcy ¶ 522.01 (16th ed. 2020). California has opted out of the Bankruptcy Code’s list of exemptions. See C.C.P. § 703.130. As a result, California exemption law controls the resolution of Schaefers’ homestead exemption claim. In re Elliott, 523 B.R. at 192 (citing Kelley v. Locke (In re Kelley), 300 B.R. 11 , 16 (9th Cir. BAP 2003)). California defines a homestead as a dwelling where a person resides. C.C.P. § 704.710(a) and (c). Californians may, therefore, claim a homestead exemption without holding a fee simple interest in the subject real property. In re Elliott, 523 B.R. at 196 & n.4; see also Phillips v. Gilman (In re Gilman), 887 F.3d 956 , 965 (9th Cir. 2018) (“California law rejects Phillips’ argument that title to the property is necessary to claim a homestead exemption.”). Even so, they must have some legal or equitable interest in the real property. In re Elliott, 523 B.R. at 196 & n.4; see also Fontaine v. Conn (In re Fontaine), BAP No. CC-10–1003–MkHKi, 2010 WL 6259993 , at *10 (9th Cir. BAP Nov. 26, 2010), aff'd, 472 F. App’x 738 (9th Cir. 2012) (“Without any legal or equitable interest in the Property, Ramona was not entitled to a homestead exemption. A legal or equitable interest in the property must exist for a homestead exemption to attach to that property.” (citing Alan M. Ahart, California Practice Guide: Enforcing Judgments & Debts ¶ 6:1021.1 (The Rutter Group 2010))). 8  Schaefers contends that California requires mere residence alone to establish a homestead exemption. In support of this argument, he cites to Tarlesson v. Broadway Foreclosure Investments, LLC, 184 Cal. App. 4th 931 , 936–38 (2010). However, the debtor in Tarlesson held a beneficial interest in her residence sufficient to support a homestead exemption. She owned the real property but had temporarily conveyed title to her homestead to a relative to facilitate refinancing. Id. at 935 . Significantly, the debtor- transferor and the cousin-transferee agreed that the debtor always retained the full beneficial interest in the property. Id.; see also In re Fontaine, 2010 WL 6259993 at *10-11 & n.16 (rejecting argument that California’s homestead exemption requires only mere possession under Tarlesson). Unlike the debtor in Tarlesson, Schaefers has never identified any beneficial or equitable interest in the Property to support his homestead exemption claim and concedes that he has no legal interest in it. Instead, he listed his interest in the LLC as exempt under California’s residential exemption, C.C.P. § 704.730. But under California law a limited liability company is a separate and distinct legal entity from its owners or members. Curci Invs., LLC, 14 Cal. App. 5th at 220-21 (citing Cal. Corp. Code § 17701.04 (a)). Consequently, limited liability company members have no interest in the company’s assets. Abrahim & Sons Enters. v. Equilon Enters., LLC, 292 F.3d 958 , 963 & n.21 (9th Cir. 2002); see also Swart Enters., Inc. v. Franchise Tax Bd., 7 Cal. App. 5th 497 , 510 (2017) (citing former Cal. Corp. 9 Code § 17300 and stating that “Members in an LLC . . . hold no direct ownership interest in the company’s specific property.”). California’s residential exemption is inapplicable to Schaefers’ interest in the LLC, which constitutes a personal property interest outside the statutory definition of a homestead under C.C.P. § 704.710(c). See In re Bell, No. 04–45847 EDJ, 2007 WL 4190686 at *2-3 (Bankr. N.D. Cal. Nov. 21, 2007) (holding that a partnership interest was not a dwelling and hence did not qualify for a homestead exemption). Schaefers has suggested that the LLC’s ownership of the Property did not preclude his homestead exemption because California permits individuals to maintain a homestead exemption even when legal title to the subject real property is held in the individuals’ revocable trust. In support of this argument, he cites to Fisch, Spiegler, Ginsburg & Ladner v. Appel, 10 Cal. App. 4th 1810 , 1811 (1992). The Appel court reasoned that the individual trustees still retained an equitable interest in their residence based on their undisputed ability to revoke the trust and their resulting contingent reversionary interest in the real property. Id. at 1813 . This interest, together with a stated life estate, established “an interest in the property supporting their homestead exemption.” Id. As explained in Appel, the extensive use of revocable trusts for estate planning also weighed heavily in favor of recognizing the trustees’ continued interest to support their homestead exemption. Id. 10  Schaefers offered at oral argument that he had chosen to place the Property in the LLC for a similar reason. No such evidence was presented to the bankruptcy court on this issue, and we fail to see the similarities between a revocable living trust and Schaefers’ LLC.6 There is nothing before us to suggest that limited liability companies are commonly used for estate planning purposes like revocable trusts or that their members should be permitted to disregard the entities’ separate identity. See Curci Invs., LLC, 14 Cal. App. 5th at 220-21. As such, Schaeffers’ interest in the LLC does not demonstrate an equitable interest to support his homestead exemption claim.7 The California requirement that the debtor must have some interest in the homestead property is consistent with the scope of the Bankruptcy Code’s exemption statute, which only applies to property of the estate. See 6 Limited liability companies are a form of hybrid business entity that generally allows its members to participate in management of the company’s operations without exposing themselves to personal liability for the company’s debts and therefore are a preferred means of conducting business under many circumstances. J. William Callison & Maureen A. Sullivan, Limited Liability Companies: A State-by-State Guide To Law And Practice, § 2:5 (2020 ed.). 7 See In re Bell, 2007 WL 4190686 , at *3 (distinguishing Appel and holding that debtor’s interest in a partnership that owned his residence was not sufficient to support his homestead exemption claim, when he held no interest in the real property and no right to acquire the partnership’s title to it by revocation); see also In re Breece, 487 B.R. 599 (table), 2013 WL 197399 at *8 (6th Cir. BAP Jan. 18, 2013) (denying homestead exemption under Ohio law to individual debtor who resided in property owned by her limited liability company). 11 § 522(b)(1); see also Schwab, 560 U.S. at 774 (holding that unopposed exemption claims “exclude the subject property from the estate”). Aside from certain nuances not relevant here, property of the estate only includes property in which the debtor has a legal, equitable, or community property interest. § 541(a); see also Jess v. Carey (In re Jess), 169 F.3d 1204 , 1207 (9th Cir. 1999) (“Notwithstanding certain specified exceptions, the bankruptcy estate includes all legal and equitable interests in property held by the debtor at the time of filing.”). Schaefers failed to prove that he held any equitable or legal interest in the Property. Accordingly, it is not property of the estate, and he cannot claim any exemption in it. See In re Breece, 487 B.R. 599 , 2013 WL 197399 at *9. Schaefers next contends that the Superior Court’s finding that the LLC is his alter ego established his equitable interest in the Property for purposes of validating his homestead exemption claim. As Schaefers put it: “Principals of equity under lied [sic] the Order of finding alter ego but yet principals of equity somehow have not been recognized with regard to the Debtors [sic] equitable claim of homestead.” Aplt. Opn. Br. at 4:2-5. However, Schaefers misapprehends the legal effect of the Superior Court’s ruling. Common law principles of alter ego liability apply to limited liability companies and their members. See Cal. Corp. Code § 17703.04 (b). Under California common law, a judgment creditor may allege that a member of a 12 limited liability company is the company’s alter ego in order to reverse pierce the company veil and reach its assets to enforce a judgment against an individual member. Curci Invs., LLC, 14 Cal. App. 5th at 224. But alter ego is not a claim or cause of action that, when successful, treats the owner and the company as the same legal entity for all purposes. Ahcom, Ltd. v. Smeding, 623 F.3d 1248 , 1252 (9th Cir. 2010). Rather, it is a procedural device that permits courts to disregard the legal separateness between a business entity and an owner for limited purposes – such as “where the corporate form is being used by the individuals to escape personal liability, sanction a fraud, or promote injustice.” Hennessey's Tavern, Inc. v. Am. Air Filter Co., 204 Cal. App. 3d 1351 , 1359 (1988) (citing Taylor v. Newton, 117 Cal. App. 2d 752 , 757 (1953)). Typically, the entity’s separate identity is disregarded “so that the corporation will be liable for acts of the stockholders or the stockholders liable for acts done in the name of the corporation.” Shaoxing Cty. Huayue Imp. & Exp. v. Bhaumik, 191 Cal. App. 4th 1189 , 1197-98 (2011) (citing Mesler v. Bragg Mgmt. Co., 39 Cal. 3d 290 , 300 (1985)). Alter ego principles almost never enable ”the persons who actually control the corporation to disregard the corporate form.” Capon v. Monopoly Game LLC, 193 Cal. App. 4th 344 , 357 (2011) (quoting Communist Party v. 522 Valencia, Inc., 35 Cal. App. 4th 980 , 994 (1995)). As the California Courts of Appeal have aptly observed, “[p]arties who determine to avail 13 themselves of the right to do business by means of the establishment of a corporate entity must assume the burdens thereof as well as the privileges. The alter ego doctrine is applied to avoid inequitable results not to eliminate the consequences of corporate operations.” Communist Party, 35 Cal. App. 4th at 994 (quoting Aladdin Oil Corp. v. Perluss, 230 Cal. App. 2d 603 , 614 (1964)). California has recognized that in limited circumstances a corporation may “disavow the corporate form where doing so prevents injustice.” Brooklyn Navy Yard Cogeneration Partners, L.P. v. Sup. Ct., 60 Cal. App. 4th 248 , 259 (1997) (collecting cases). Importantly, however, Schaefers did not independently attempt to disavow his LLC’s separate identity. Nor did he explain to the bankruptcy court why recognizing his choice to place the Property in his LLC would result in injustice. Some explanation – and evidence – of this type was required before the bankruptcy court properly could pierce the LLC’s veil for Schaefers’ benefit. See, e.g., Capon, 193 Cal. App. 4th at 357 (“defendants have not identified on appeal . . . any inequitable results that would follow from rejecting defendants’ attempt to disregard the legal separateness of [the business entity]”). Instead, Schaefers relied solely on the Superior Court’s extension to the LLC of his individual liability for the Blizzard Judgment, which was based on his inequitable conduct. He claims that this extension of liability is a sufficient basis, by itself, to avoid the consequences of his decision to have 14 the LLC own the Property. Based on the authorities cited above, we disagree. The bankruptcy court properly held that the Superior Court’s reverse alter ego finding did not consolidate the LLC’s assets into Schaefers’ bankruptcy estate. CONCLUSION For the reasons set forth above, we AFFIRM the bankruptcy court’s order sustaining the exemption claim objection and disallowing Schaefers’ homestead exemption claim. 15

2020-01-17 22:01:46.20792+00

Aeunkell

*823OPINION. Aeunkell: The evidence before us on the question of the value of any good will acquired for stock is confined to gross sales, profits and losses, advertising expenditures and net tangibles of the Humphrey Co. prior to the merger, and of the Humphrey Division of petitioner subsequent to that event. We are asked to determine from that evidence that the Humphrey Co. was possessed of a valuable good will which became the property of the petitioner by reason of the merger, and of the transfer of the business of the Humphrey Co. to petitioner, and to determine, from the same evidence, what the value of such good will may have been. We are asked to assume that all earnings of the Humphrey Co. in excess of a fair return upon its net investment in tangible properties are directly attributable to good will, and to capitalize such excess earnings at either 10, 15, or 20 per cent, and accept the result as reflecting the fair value of the good will. We decline, for obvious reasons, to take that course. We might just as well assume that all of the earnings in excess of a fair return on the tangibles were attributable directly to patents. The *824Humphrey Co. was a manufacturing organization, and patents were specifically included in the transfer of assets to the petitioner. The evidence does not justify one of these assumptions in preference to the other. Nothing has been given to us in the way of evidence as to the background of the successes and reverses of the Humphrey Co. We know nothing whatever as to its business policies, particularly as they affected the company’s relations with its customers, as to the steps taken toward the development of markets for its products, and as to the reputation of its products as to grade, quality, and serviceability. Without this background, any conclusion that we might draw from the mere application of a formula to earnings would be entirely a matter of conjecture. Joseph Z. Muir, et al., 4 B. T. A. 893; Landesman-Hirschheimer Co., 15 B. T. A. 64. While the case was tried on the theory that there was issued to the Humphrey Co. capital stock of the par value of $405,900, divided into $316,000 of preferred and $89,900 of common, we are not unmindful of the fact that the agreement of March 24, 1913, between the Humphrey and Ruud Companies provided for the sale of all of the former’s assets to the latter for 290 shares of the latter’s common stock and the issuance thereafter of preferred stock of the Ruud Co. in an amount equal to the appraised value of the Humphrey Co.’s assets, specifically excluding therefrom the good will and patents. The issuance of preferred stock to the Humphrey Co. or its nominees in. the par amount of $316,000 was pursuant to this agreement. The additional common stock was issued to the former stockholders of the Humphrey Co. as a stock dividend, pursuant to a stockholder’s resolution adopted on July 14, 1913, and not under any provision of the agreement of sale. The allegation of error respecting depreciation was abandoned at the hearing with the exception of exhaustion on manufacturing equipment, which the parties stipulated has a value for depreciation purposes of $125,582.39 and $153,590.13 for the respective taxable years. The petitioner is asking us to allow depreciation at the rate of 10 per cent claimed by it in its returns, instead of 1 per cent, the figure allowed by the respondent. The uncontradicted testimony of the two qualified witnesses presented by the petitioner is that the manufacturing equipment has a useful life of 10 years. Their opinions are amply supported by their testimony as to life of the various classes of equipment comprising the whole, and we are of opinion that 10 per cent is a fair rate and should be used in computing the reasonable allowance provided by the statute. The contention of the petitioner respecting the remaining issue is, in substance, that the term “ paid ” as used in the taxing acts in con*825nection with credits allowed for taxes levied by foreign countries, means no more than “ paid or payable,” and inasmuch as the amount of taxes which it paid the Dominion of Canada for the years 1918 and 1919 was not known or payable until after the receipt in July, 1921, of notices of assessment, the taxes are a proper credit for the year 1921, the year in which they were paid, even though it kept its books on the accrual basis. In support of its position, the petitioner has introduced into the record the Income War Tax Act, 1917, enacted by the Parliament of Canada, September 20,1917, together with amendments thereto dated May 24, 1918, and July 7, 1919. The notices of assessment clearly show that the taxes paid were assessed under the provisions of the Business Profits War Tax Act, 1916, which act has not been proved, and is not therefore before us as a fact for a consideration of its terms. See W. J. Burns, 12 B. T. A. 1209. Without proof of the foreign law under the terms of which the taxes were levied and paid, we are unable to say whether they come within the class of income, war-profits and excess-profits taxes allowed as a credit by section 238 of the Revenue Acts of 1918 and 1921, and if we were to indulge in the presumption that the taxes are within that limited classification, we would still be unable to ascertain that they did not accrue or become payable prior to 1921, as determined by the respondent. The petitioner also contends that as the amount of taxes paid to foreign countries is allowed as a credit against domestic income, war-profits and excess-profits taxes, as distinguished from a deduction from gross income, income would not be distorted in any way by taking the credit in the year in which the taxes are paid, even though that be after the 'taxes actually accrued. The word “ paid ” as defined by Congress in section 200 of the Revenue Acts of 1918 and 1921 applies to deductions and credits with equal force. That Congress intended taxpayers on an accrual basis of accounting to take the credit when the taxes accrue, rather than when paid, is further evidenced by the terms of section 238 of the taxing acts, which provides for a refund or a credit or further payment of taxes in the event the accrued taxes when paid differ from the amounts claimed as credits. In Henry Reubel, 1 B. T. A. 676, we held that in general the phrase “ paid or accrued ” as used in the statute, is to be construed in the alternative and forbids the use of both bases in one income-tax return. See also Atlantic Coast Line R. R. Co., 2 B. T. A. 892. Judgment will be entered wider Rule 50.

2021-01-26 21:00:40.340123+00

http://media.ca7.uscourts.gov/cgi-bin/rssExec.pl?Submit=Display&Path=Y2021/D01-26/C:20-1200:J:Kanne:aut:T:fnOp:N:2650424:S:0

In the United States Court of Appeals For the Seventh Circuit ____________________ No. 20‐1200 E.F.L., Petitioner‐Appellant, v. BILL PRIM, et al., Respondents‐Appellees. ____________________ Appeal from the United States District Court for the Northern District of Illinois, Eastern Division. No. 1:20‐cv‐00072 — Steven Charles Seeger, Judge. ____________________ ARGUED OCTOBER 29, 2020 — DECIDED JANUARY 26, 2021 ____________________ Before FLAUM, KANNE, and HAMILTON, Circuit Judges. KANNE, Circuit Judge. E.F.L.’s1 petition for habeas corpus asks that we enjoin the Department of Homeland Security from removing her while her Violence Against Women Act 1 Because of E.F.L.’s allegations of domestic abuse and her fear of re‐ taliation, this court granted her motion to use a pseudonym while pursu‐ ing this appeal. See Doe v. Blue Cross & Blue Shield United of Wis., 112 F.3d 869 , 872 (7th Cir. 1997). 2 No. 20‐1200 petition is pending. That petition, though, has been approved. So E.F.L.’s request is moot. Plus, Congress has divested us of jurisdiction over such challenges. We thus affirm the district court’s decision dismissing E.F.L.’s habeas petition for want of jurisdiction, and we terminate our temporary stay of re‐ moval. I. BACKGROUND E.F.L. is a Mexican national and citizen who has lived in the United States for nearly twenty years.2 During that time, she has endured domestic abuse that is extreme in nature. We will not repeat any nongermane details of her harrowing alle‐ gations here. But in 2018, the Department of Homeland Secu‐ rity (“DHS”) discovered E.F.L.’s undocumented presence in the country, reinstated a prior removal order against her, and scheduled her removal. E.F.L. then travailed several avenues pursuing relief from removal. First, E.F.L. filed an application for withholding of removal under the Immigration and Nationality Act and the Convention Against Torture. While that application was un‐ der review, she sought alternative relief by filing a self‐peti‐ tion under the Violence Against Women Act (“VAWA”) with the United States Citizenship and Immigration Services (“USCIS”). The resolution of these pursuits has been a bit circuitous. An immigration judge and the Board of Immigration Appeals denied E.F.L.’s application for withholding of removal, and we declined to review that decision. After we did so—but 2 We accept as true all of E.F.L.’s well‐pled factual allegations and draw all reasonable inferences in her favor. See Long v. Shorebank Dev. Corp., 182 F.3d 548 , 554 (7th Cir. 1999). No. 20‐1200 3 while E.F.L.’s VAWA petition remained pending—DHS sought to execute E.F.L.’s removal order. That prompted E.F.L. to file the habeas petition currently before us. E.F.L.’s habeas petition seeks “preliminary and permanent injunctive relief enjoining [DHS] from removing [her] from the U.S. while her VAWA self‐petition remains pending with USCIS.” As a basis for this injunction, the petition alleges that “[i]f USCIS approves her VAWA self‐petition, then [she] will receive deferred action, employment authorization, and per‐ mission to remain in the U.S.” And as a result, DHS would violate the Due Process Clause and the Administrative Proce‐ dure Act by executing E.F.L.’s removal order while her VAWA petition remains pending. The district court dismissed E.F.L’s habeas petition for lack of subject matter jurisdiction because 8 U.S.C. § 1252 (g) provides that no court has jurisdiction to entertain a challenge to DHS’s decision to execute a removal order. That decision is the basis of this appeal. We entered a temporary stay of re‐ moval while considering this appeal. During the pendency of this appeal, USCIS approved E.F.L.’s VAWA petition. Based on that approval, E.F.L. sub‐ mitted adjustment of status and waiver applications to USCIS. She has not yet received work authorization as she expected. II. ANALYSIS “We review de novo the district court’s dismissal for lack of subject‐matter jurisdiction.” Glaser v. Wound Care Consult‐ ants, Inc., 570 F.3d 907 , 912 (7th Cir. 2009) (citing Scott v. Trump Ind., Inc., 337 F.3d 939 , 942 (7th Cir. 2003)). “Federal courts are courts of limited jurisdiction. They possess only that power authorized by Constitution and 4 No. 20‐1200 statute, which is not to be expanded by judicial decree.” United States v. Alkaramla, 872 F.3d 532 , 534 (7th Cir. 2017) (quoting Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375 , 377 (1994)). E.F.L.’s habeas petition falls outside of that limited juris‐ diction for two reasons. First, the petition is moot because E.F.L.’s VAWA petition has been approved. Second, in 8 U.S.C. § 1252 (g) Congress stripped federal courts of jurisdic‐ tion over such challenges to executive branch decisions to ex‐ ecute removal orders. A. Mootness The Constitution limits our jurisdiction to resolving live “Cases” and “Controversies,” rather than issuing advisory opinions. U.S. Const. art. III, § 2, cl. 1. “Mootness is a consti‐ tutional doctrine designed to avoid the issuance of advisory opinions. ‘[A] suit becomes moot … when it is impossible for a court to grant any effectual relief whatever to the prevailing party.’” Trinity 83 Dev., LLC v. ColFin Midwest Funding, LLC, 917 F.3d 599 , 601–02 (7th Cir. 2019) (first alteration in original) (quoting Chafin v. Chafin, 568 U.S. 165 , 172 (2013)). If this oc‐ curs, federal courts lose subject matter jurisdiction over the case. See In re Repository Techs., Inc., 601 F.3d 710 , 716–17 (7th Cir. 2010). We thus have a “constitutional obligation to resolve the question of mootness” and address it sua sponte if needed. United States v. Fischer, 833 F.2d 647 , 648 n.2 (7th Cir. 1987) (citing North Carolina v. Rice, 404 U.S. 244 , 246 (1971)). E.F.L.’s habeas petition is moot because it seeks to enjoin DHS from executing her removal order while her VAWA pe‐ tition is pending, but that petition has now been approved. So we cannot grant E.F.L. the effectual relief she asks for. No. 20‐1200 5 Both E.F.L. and the government argue that, nevertheless, this case still presents a live dispute because E.F.L. is now seeking other forms of relief from removal, such as adjust‐ ment of status, that are “natural successors” to her now‐ap‐ proved VAWA petition. But E.F.L.’s habeas petition does not ask for an injunction so that she can seek such relief. It asks for one so that USCIS can rule on her VAWA petition. In fact, the habeas petition re‐ peats several times that “[i]f USCIS approves her VAWA self‐ petition, then [E.F.L.] will receive deferred action, employ‐ ment authorization, and permission to remain in the U.S.,” in‐ dicating that there were no “natural successors” to the VAWA petition. Given our limited role of ruling on the cases that come be‐ fore us, we will not amend E.F.L.’s petition to state otherwise just to keep this matter alive. See N.Y. State Rifle & Pistol Ass’n, Inc. v. City of New York, 140 S. Ct. 1525 , 1526 (2020) (holding that the case became moot once the challenged statute changed during the appeal process, and declining to rule on the propriety of the updated statue or consider alternative forms of relief not requested in the complaint). Both parties also argue that our recent decision in Meza Morales v. Barr, 973 F.3d 656 (7th Cir. 2020), compels us to hold that this case is not moot. We disagree. Meza Morales was an undocumented immigrant who ap‐ plied to USCIS for a “U visa,” which could have entitled him to remain in the United States and to seek work authorization. Id. at 657–58. While this petition was pending, Immigration and Customs Enforcement sought to remove him. Id. at 659– 60. After unsuccessfully seeking several forms of relief, Meza 6 No. 20‐1200 Morales applied to us for an emergency stay of removal while his U visa application was pending. Id. at 660 . As we were re‐ viewing Meza Morales’s case, USCIS approved him for a U visa and granted him deferred action. Id. His “removal order remain[ed] on the books, though, and Meza Morales con‐ tinue[d] to petition our court for review of it.” Id. We thus held that the approval of Meza Morales’s U visa application did not render his case moot; Meza Morales asked for “vacatur of the removal order,” and we could still grant that relief. Id. E.F.L.’s habeas petition is different. It does not request that we vacate E.F.L.’s removal order or grant her any other still‐ possible forms of relief. All it asks is that we enjoin DHS from removing E.F.L. while her VAWA petition is pending. As ex‐ plained, we are now wholly unable to provide that relief. E.F.L. lastly argues that her petition is not moot because the issues it raises are “capable of repetition, yet evading re‐ view.” Fischer, 833 F.2d at 649 . For this mootness exception to apply, “there must be a ‘“demonstrated probability” that the same controversy will recur involving the same complaining party.’” Id. (quoting Murphy v. Hunt, 455 U.S. 478 , 482 (1982)). That condition is not met here because the controversy set forth in E.F.L.’s habeas petition—whether DHS can execute E.F.L.’s removal order while she has a pending VAWA peti‐ tion—cannot recur. Her VAWA petition has been approved once and for all. B. 8 U.S.C. § 1252 (g) Congress has given federal courts of appeal the power to review removal orders. 8 U.S.C. § 1252 (a). But what Congress can give, it can take away. In 8 U.S.C. § 1252 (g), Congress did just that and divested us of jurisdiction over challenges to No. 20‐1200 7 executive branch decisions to execute removal orders. That ju‐ risdiction‐stripping provision states: Except as provided in this section and notwithstanding any other provision of law (statutory or nonstatutory), includ‐ ing section 2241 of Title 28, or any other habeas corpus pro‐ vision, and sections 1361 and 1651 of such title, no court shall have jurisdiction to hear any cause or claim by or on behalf of any alien arising from the decision or action by the Attorney General [or DHS] to commence proceedings, ad‐ judicate cases, or execute removal orders against any alien under this chapter.3 This statute does not sweep broadly; only challenges to the three listed decisions or actions—to commence proceedings, adjudicate cases, or execute removal orders—are insulated from judicial review. Reno v. Am.‐Arab Anti‐Discrimination Comm., 525 U.S. 471 , 482 (1999). For instance, in Fornalik v. Per‐ ryman, we exercised jurisdiction over a noncitizen’s habeas petition, and even stayed the execution of his removal order, because “[h]is claim [wa]s not that the Attorney General [wa]s unfairly executing a removal order, but rather that a prior, un‐ related error ma[de] his removal improper.” 223 F.3d 523 , 532 (7th Cir. 2000). But § 1252(g)’s narrow sweep is firm; we cannot entertain challenges to the enumerated executive branch decisions or actions. For example, in Sharif ex rel. Sharif v. Ashcroft, two ha‐ beas petitioners sought to enjoin the Immigration and Natu‐ ralization Services (“INS”) from executing removal orders 3 Section 1252(g)’s reference to the Attorney General applies to the de‐ cisions and actions of DHS. See 6 U.S.C. §§ 251 , 557; Elgharib v. Napolitano, 600 F.3d 597 , 606–07 (6th Cir. 2010) (“[T]he statutory reference to the ‘At‐ torney General’ in § 1252(g) now means ‘Secretary of DHS.’”). 8 No. 20‐1200 against them while they pursued administrative review and applied for statutory relief. 280 F.3d 786 , 787 (7th Cir. 2002). We held that § 1252(g) barred federal courts from exercising jurisdiction over these petitions because they arose from the INS’s decision to execute the removal orders. Id.; see also Gomez‐Chavez v. Perryman, 308 F.3d 796 (7th Cir. 2002) (hold‐ ing that § 1252(g) barred an immigrant’s challenge to the exe‐ cution of a removal order while his application for waiver of inadmissibility was outstanding); Fedorca v. Perryman, 197 F.3d 236 , 240 (7th Cir. 1999) (“Fedorca seeks as relief only a stay of deportation pending his appeal to the BIA—or in other words, review of the decision to execute his deportation, which is barred by § 1252(g).”). E.F.L.’s habeas petition falls directly in § 1252(g)’s path. Like the petitioners in Sharif, E.F.L. challenges DHS’s decision to execute her removal order while she seeks administrative relief. And unlike the petitioner in Fornalik, she does not chal‐ lenge the legality of her removal order. Federal courts thus do not have jurisdiction to hear her claim. The heart of E.F.L.’s argument to the contrary is that § 1252(g) limits judicial review of DHS’s “discretionary deci‐ sions” to execute removal orders, but here, E.F.L. challenges DHS’s “legal authority” to execute her removal order her while she seeks administrative relief. This argument is not persuasive. First, it runs smack into precedent. In Sharif, to take just one of many examples, the petitioners made nearly identical arguments, as explained above, and we held that § 1252(g) barred us from exercising jurisdiction. No. 20‐1200 9 Second, the distinction between DHS’s “discretionary de‐ cisions” and its “legal authority” to execute removal orders is illusory. Section 1252(g) precludes judicial review of “any” challenge to “the decision or action by [DHS] to … execute removal orders.” That includes challenges to DHS’s “legal au‐ thority” to do so. Otherwise, § 1252(g) would be a paper tiger; any petitioner challenging the execution of a removal order could characterize his or her claim as an attack on DHS’s “le‐ gal authority” to execute the order and thereby avoid § 1252(g)’s bar. See Ragbir v. Homan, 923 F.3d 53 , 64 (2d Cir. 2019), cert. granted, judgment vacated sub nom. Pham v. Ragbir, 141 S. Ct. 227 (2020) (“To remove th[e] decision [to execute a removal order] from the scope of section 1252(g) because it was allegedly made based on unlawful considerations would allow plaintiffs to bypass § 1252(g) through mere styling of their claims.”); Tazu v. Att’y Gen. U.S., 975 F.3d 292 , 298 (3d Cir. 2020) (“Any other rule would gut § 1252(g).”). We will not render § 1252(g) so toothless. E.F.L. also makes several secondary arguments against the application of § 1252(g). To start, she relies on the Supreme Court’s decision in I.N.S. v. St. Cyr, which allowed a habeas petitioner to challenge “the Attorney General’s conclusion that, as a matter of statutory interpretation, he [wa]s not eligi‐ ble for discretionary relief.” 533 U.S. 289 , 298 (2001). E.F.L. has not presented a similar challenge. Instead, she has asked a federal court to bar DHS’s execution of her admittedly valid removal order. In addition, St. Cyr’s only mention of § 1252(g) is a footnote explaining that the section was “not relevant” and reaffirming Reno’s holding that § 1252(g) bars jurisdiction over challenges to the execution of removal orders. Id. at 311 n.34 (citing Reno, 525 U.S. at 471 )). 10 No. 20‐1200 E.F.L. also asserts that in Subhan v. Ashcroft, 383 F.3d 591 (7th Cir. 2004), we created an exception to § 1252(g) that ap‐ plies here. We did not. In Subhan, we reviewed an immigra‐ tion judge’s decision to enter an order of removal and held that the immigration judge erred in denying the petitioner a continuance in the proceedings without reasoning why. Id. at 595. The case had nothing to do with § 1252(g). As a final note, contrary to E.F.L.’s arguments, neither the APA nor the Suspension Clause mandates that we must have jurisdiction over E.F.L.’s petition. The APA is inapplicable be‐ cause § 1252(g) precludes judicial review and because DHS’s decision to execute E.F.L.’s removal order is discretionary. 5 U.S.C. § 701 (a) (“This chapter applies, according to the provi‐ sions thereof, except to the extent that— (1) statutes preclude judicial review; or (2) agency action is committed to agency discretion by law.”); see also Lalani v. Perryman, 105 F.3d 334 , 337 (7th Cir. 1997) (“[T]he APA is not a useful tool for aliens challenging immigration decisions.”). And the Suspension Clause is inapplicable because E.F.L.’s habeas petition does not “contest[] the lawfulness of restraint” or seek to “secur[e] release” from custody; it instead vies for her right to “remain in [the United States] or to obtain administrative review po‐ tentially leading to that result.” Depʹt of Homeland Sec. v. Thuraissigiam, 140 S. Ct. 1959 , 1969 (2020). III. CONCLUSION We acknowledge the district court’s recognition of “the se‐ riousness of E.F.L.’s allegations about decades of abuse, and the extraordinarily difficult situation that she and her family continue to face.” But we cannot provide E.F.L. the relief that she seeks. The judgment of the district court is therefore AFFIRMED, and the temporary stay of DHS’s execution of No. 20‐1200 11 E.F.L.’s removal order is TERMINATED as of the date of this opinion.

2021-01-26 21:00:40.497591+00

http://media.ca7.uscourts.gov/cgi-bin/rssExec.pl?Submit=Display&Path=Y2021/D01-26/C:20-1868:J:Flaum:aut:T:fnOp:N:2650757:S:0

In the United States Court of Appeals For the Seventh Circuit ____________________ No. 20-1868 145 FISK, LLC, Plaintiff-Appellant, v. F. WILLIAM NICKLAS, Defendant-Appellee. ____________________ Appeal from the United States District Court for the Northern District of Illinois, Western Division. No. 19-cv-50093 — Philip G. Reinhard, Judge. ____________________ ARGUED DECEMBER 10, 2020 — DECIDED JANUARY 26, 2021 ____________________ Before SYKES, Chief Judge, and FLAUM and KANNE, Circuit Judges. FLAUM, Circuit Judge. Illinois authorizes municipalities to invest in revitalizing areas of “commercial blight.” See 65 Ill. Comp. Stat. 5/11-74.4 et seq. The City of DeKalb, Illinois (the “City”), entered into a preliminary agreement to allocate just such an incentive to 145 Fisk, LLC (“Fisk”). After more due diligence, however, the City reversed course. 2 No. 20-1868 Fisk is convinced the City would have proceeded with the funding as planned but for the meddling of City Manager F. William Nicklas. According to Fisk, Nicklas sought to retali- ate against it and favor other local developers in violation of its First and Fourteenth Amendment rights. The district court dismissed Fisk’s suit for failure to state a claim upon which relief can be granted and relinquished supplemental jurisdic- tion over the remaining state law claims. Because we agree that Fisk has not plausibly stated grounds for relief, we affirm the judgment of the district court. I. Background Plaintiff-appellant Fisk is a limited liability company. The entity was formed on December 13, 2018, and it consisted of two members, one of whom is an attorney (“Attorney Mem- ber”). Fisk alleges that for over two years it collaborated with the City regarding a proposed redevelopment of a dilapidated property at 145 Fisk Avenue in DeKalb. On December 18, 2018, the City adopted Resolution 2018-166 approving a Pre- liminary Development Incentive Agreement (“PDA”) with Fisk regarding potential financing for the project. The PDA, into which the parties entered on or about January 1, 2019, provided that if Fisk met certain contingencies set forth therein, the City would provide an approximate $2,500,000 Development Incentive (“Development Incentive”) in Tax In- crement Financing (“TIF”) to Fisk for the redevelopment. Per the PDA, the Development Incentive was “intended to be re- paid as a forgivable incentive, payable through the generation of revenues from the development of the Property after the date of final plan approval.” No. 20-1868 3 Both the PDA and the Resolution, however, imposed con- ditions and obligations on both parties before finalizing the development agreement and distributing the funds. The Res- olution provided that the City Council “hereby approves of the Development Incentive Agreement … subject to such amendments as shall be acceptable to the Mayor with the rec- ommendation of the City Manager. Staff is authorized to ne- gotiate and proceed with presentation of [the] Final Develop- ment Agreement for consideration of approval at a future date.” The PDA likewise subjected the Development Incentive to various contingencies. For example, Recital C of the PDA states “the Parties have entered into this Agreement so as to provide an incentive for [Fisk] to … proceed with the pro- posed project, subject to the contingencies outlined herein.” Recital E continued: “[Fisk] acknowledges that the City is not required to provide the incentive contemplated herein ….” In- deed, the extent of the arrangement is an “agreement to con- ditionally approve.” The PDA further states in Article II(A) that “[Fisk] acknowledges all contingencies outlined in this Agreement, and agrees and acknowledges that until all such contingencies are fully satisfied, it has no basis to detrimen- tally rely upon the representations of the City with respect to the availability of incentive funding.” With respect to costs in- curred, under Article II(A) “[Fisk] agrees and acknowledges that any costs incurred prior to approval of a planned devel- opment agreement as contemplated herein … are incurred at [Fisk]’s sole risk and cost until such point in time as the Prop- erty is rezoned and the planned development agreement is approved, and any other conditions or contingencies outlined herein are satisfied in full.” (Emphasis added). Even in defin- ing the “Development Incentive,” Article V(B) states “All 4 No. 20-1868 provisions of this Article V are contingent upon [Fisk] obtain- ing final approval of its plans, rezoning the Property, lender financing, and executing a planned development agreement as described above.” Amid the negotiations over the redevelopment project, a transition in the City’s personnel marked the beginning of the end for Fisk’s proposed Development Incentive. Around Jan- uary 1, 2019, F. William Nicklas became the new City Man- ager. Unsatisfied with previous due diligence, Nicklas opened his own inquiries into Fisk’s financial affairs and de- velopment plans. This included a series of in-person meetings and exchanges during February and March 2019 between Nicklas and Fisk’s principals. Nicklas requested “personal in- formation” about the principals, their affiliates, and their fi- nancial situation. Nicklas even spoke with the Attorney Mem- ber’s personal banker. Nicklas also requested information about the corporate entity itself, including a worksheet to in- dicate its “financial viability.” Fisk never, however, affirma- tively states in the record what amount of working capital the principals or the corporate entity specifically had to fund the project contemplated by the PDA. By Fisk’s account, all Nick- las’s requests duplicated the City’s prior ones and were not required by the Resolution or PDA. Nicklas’s review exposed cracks in the project’s founda- tion. In an email to Fisk dated April 1, 2019, Nicklas stated he felt “duty-bound” to inform the Council that in his opinion Fisk did not have “the financial capacity or the experience” needed for the funding. Nicklas based this conclusion on sub- missions from Fisk, including the financial worksheet, a budget for three years of operation following 145 Fisk Ave- nue’s completion, and the principals’ own No. 20-1868 5 “acknowledgment” during a March 2019 meeting that neither “ha[d] ever developed a hotel property in the past.” Nicklas recommended Fisk withdraw its application. Specifically, Nicklas stated: [M]y judgment is based upon the following con- clusions: 1. No balance sheet for 145 Fisk LLC has been submitted, but your submittal shows no current or long-term assets that can be pledged as col- lateral. The corporation controls a 24,000 square foot, uninhabitable facility with an estimated market value of only $300,000. 2. 145 Fisk LLC has not secured any sources of income to complete the project or operate the project upon its completion. 3. 145 Fisk LLC has no working capital and its operations are not generating any capital to pay for current expenses, much less the ongoing professional consulting fees incurred to date in the conceptual planning phase of the project. 4. On the basis of your submittal, it appears that 145 Fisk LLC is relying upon a $2.5 million TIF grant from the City and 100% of the balance of the equity funding from one or more financial institutions. Your submittal offers no working cash from the principals, or pledged private as- sets, or lines of credit, or other private equity to help finance the project. 5. You do not reveal the real and comparable ho- tel development upon which you are basing the 6 No. 20-1868 projected three-year profit and loss prospectus you submitted. Since you have not developed a hotel, your numbers are not rooted in an actual operation, so far as you have revealed. They [sic] are so many numbers on a page. 6. As you may know, TIF assistance carries a federal income tax liability. Your submittal shows no indication that 145 Fisk LLC could carry that liability except at the expense of the project’s development. 1 Disagreement ensued. In a series of subsequent ex- changes, the Attorney Member reiterated that the corporate entity was “simply a holding [LLC] at this point” and Nick- las’s “specific comments 1-6 [were]n’t accurate, include[d] er- roneous assumptions, [we]re disingenuous, or [we]re com- pletely out of context.” The Attorney Member emphasized “[a]ll [they] need is a loan commitment to proceed, but … commitment and income sources cannot be secured until a formal commitment from the City is finalized.” Fisk also re- jected Nicklas’s recommendation to withdraw its application for the Development Incentive. 1 The City Attorney reiterated these concerns as well. In an April 2, 2019 email attached as an exhibit to Fisk’s operative complaint, he wrote the “fundamental question that the City Manager is trying to address is the appropriateness of and/or necessity for a financial incentive.” Moreover, he contextualized that the City required submission of a detailed financial pro forma (along with other documents) in its review of previous requests for incentives for hotel projects that a third-party consultant reviewed for completeness, reasonableness, and accuracy. The City Attorney also in- vited Fisk to share any additional information in its possession. No. 20-1868 7 As it turns out, the events of 2019 were not the first en- counter between Nicklas and Fisk’s members. The Attorney Member represented a client in a state court lawsuit involving the City of Sycamore. In response to an interrogatory dated April 21, 2017, that client identified Nicklas—who was previ- ously Sycamore’s City Manager—as a witness. Through the proceedings, an email surfaced in which Nicklas referred to regulatory requirements imposed by “[t]hat pesky Constitu- tion” which “has strictures against artificial distinctions.” However, the client in that suit was not Fisk. In fact, Fisk had not yet come into corporate existence. During that same period, Nicklas considered two other development projects with which, Fisk alleges, Nicklas had previous financial and personal ties for funding incentives. The first was a TIF-backed hotel project with a developer named Shodeen. Nicklas had previously collaborated on a ho- tel with Shodeen that never came to fruition. The second was a TIF-backed apartment development project with John Pap- pas. Nicklas had previously represented Pappas’s major in- vestor, who intended to invest in the TIF-backed apartment, in consulting work. Nicklas ultimately recommended the City terminate the PDA with Fisk. During an April 22, 2019, meeting, the City Council addressed Nicklas’s findings. The City’s Agenda notes indicated the City did not receive “the necessary finan- cials and development plans to justify a permanent commit- ment to the allocation of $2.5 million” within 120 days of the Resolution. Specifically, the Council found the financial doc- uments “were barren of any assurance that the LLC could af- ford ongoing preliminary planning and engineering fees.” The Council further cited “insufficient project details” to 8 No. 20-1868 advance “to a formal development hearing.” Specifically, the lack of documentation for a traffic impact study, final site en- gineering plans, “storm water management report examining the site’s runoff,” floor plans, and “variances or exceptions from the City’s development ordinances.” Accordingly, “[t]he Council determined that—on the basis of all known docu- ments—there was no reasonable or informed basis upon which the project could be considered viable.” The City Coun- cil unanimously voted to terminate the PDA. Fisk filed suit that same day. Fisk commenced this action in federal court against Nick- las in his individual capacity claiming violations of state and federal law. The state law claims included tortious interfer- ence with Fisk’s business expectancy, defamation per se, and defamation per quod. Relevant to this appeal, Fisk sued under 42 U.S.C. § 1983 for violations of its rights under the First and Fourteenth Amendments. Nicklas moved to dismiss the complaint for failure to state a claim under Federal Rule of Civil Procedure 12(b)(6). In lieu of a reply to Nicklas’s Rule 12(b)(6) motion, Fisk obtained leave to file an amended complaint. Fisk filed the First Amended Complaint, the operative complaint for this appeal, on November 5, 2019. Pertinent here, Fisk claims Nicklas vio- lated its First Amendment right (Count II), as well as its Four- teenth Amendment rights to due process (Count III) and equal protection (Count IX). Nicklas again moved to dismiss pursuant to Rule 12(b)(6). Fisk opposed and alternatively re- quested leave to replead. On April 27, 2020, the district court dismissed Fisk’s fed- eral claims against Nicklas for failure to state a claim with No. 20-1868 9 prejudice and relinquished jurisdiction over the supple- mental state law claims. 2 II. Discussion We review the district court’s grant of Nicklas’s motion to dismiss de novo to determine whether Fisk has stated a claim upon which relief can be granted. Bridges v. Gilbert, 557 F.3d 541 , 545 (7th Cir. 2009). “We accept well-pleaded facts as true and draw all reasonable inferences in the plaintiff[’s] favor.” Shipley v. Chi. Bd. of Election Comm’rs, 947 F.3d 1056 , 1060–61 (7th Cir. 2020). Notwithstanding that deference, “[t]o survive a motion to dismiss, a plaintiff must allege ‘enough facts to state a claim to relief that is plausible on its face.’” Boucher v. Fin. Sys. of Green Bay, Inc., 880 F.3d 362 , 365–66 (7th Cir. 2018) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544 , 570 (2007)). A. First Amendment Count II of the complaint alleges that Nicklas retaliated against Fisk for exercising its First Amendment right. Specifi- cally, Fisk alleges that as City Manager of DeKalb, Nicklas blocked the Development Incentive and “orchestrated [a] campaign” against Fisk because its Attorney Member ex- posed unflattering information about Nicklas and named him in discovery in connection with the unrelated 2017 lawsuit. Fisk pleaded that the Attorney Member’s representation in 2 Fisk also added the City of DeKalb as a defendant in the First Amended Complaint, claiming breach of contract and the duty of good faith and fair dealing. The City moved to dismiss, or transfer, based on a forum selection clause in the PDA. The district court relinquished the state law claims against the City and therefore denied its motion to transfer as moot. 10 No. 20-1868 the 2017 lawsuit fell within “the First Amendment’s right to petition the government for the redress of grievances.” The district court dismissed Fisk’s First Amendment retaliation claim, reasoning that Fisk did not engage in protected activ- ity. That is because the client in the 2017 lawsuit, who is not a party to this litigation, engaged in protected activity by exer- cising his or her right to petition the government when he or she accessed the courts. Thus, that nonparty client has the right to be free from retaliation for exposing Nicklas, not Fisk. To make a prima facie showing on its First Amendment retaliation claim, Fisk must establish that “(1) it engaged in activity protected by the First Amendment, (2) it suffered a deprivation that would likely deter First Amendment activity in the future, and (3) the First Amendment activity was … ‘at least a motivating factor’ in the Defendant[’s] decision to take the retaliatory action.” Woodruff v. Mason, 542 F.3d 545 , 551 (7th Cir. 2008) (quoting Massey v. Johnson, 457 F.3d 711 , 716 (7th Cir. 2006)). We have recognized that a plaintiff’s exercise of “[t]he First Amendment right to petition the government for the redress of grievances” may qualify for the first prong of a First Amendment retaliation claim. See id. Furthermore, the right to petition “extends to the courts in general and ap- plies to litigation in particular.” Id. (citing Cal. Motor Transp. Co. v. Trucking Unlimited, 404 U.S. 508 , 510 (1972); NAACP v. Button, 371 U.S. 415 , 429–30 (1963)). On appeal, Fisk argues the district court erred in conclud- ing it did not engage in protected conduct to satisfy the first prong of a First Amendment retaliation claim. Fisk asserts that its protected conduct was “the work of one of its princi- pals in [the 2017] litigation.” It appears that Fisk now contends that the Attorney Member exercised his own First No. 20-1868 11 Amendment right to free speech, as distinct from his right to petition the government. Specifically, Fisk asserts that the At- torney Member exposed Nicklas in the 2017 litigation, while acting as Fisk’s agent, and thus the protected conduct is at- tributable to Fisk. Failing that, Fisk argues that even if we re- ject its arguments based on agency theory, Nicklas’s retalia- tory conduct against the Attorney Member for exercise of his free speech right nonetheless chilled Fisk from exercising its own First Amendment rights. The district court did not “erroneously ignore[] agency principles” when it concluded that Fisk did not engage in pro- tected activity in the 2017 lawsuit. The agency question is ir- relevant because the district court rightfully found that the underlying right to be free from retaliation for petitioning the government belonged to neither Fisk nor the Attorney Mem- ber. As the district court explained, “[t]he Attorney Member named Nicklas as a witness in that suit on behalf of his client in that case. He did not do so on behalf of [Fisk].” (Emphasis added). Stated another way, the client’s exercise of its First Amendment petition rights in 2017 cannot be Fisk’s “pro- tected conduct” for the purposes of Fisk’s “petition for redress of grievances retaliation claim.” See Bridges, 557 F.3d at 553 (dismissing claim because individual not party to lawsuit “ha[d] no ‘underlying claim’ that implicates his own right of access to the courts” (emphasis added) (quoting Christopher v. Harbury, 536 U.S. 403 , 415 (2009))). Fisk did not exercise its First Amendment petition right; in fact, Fisk did not even exist prior to 2018. That First Amendment right ran to the client in the 2017 suit. Fisk cannot “rely on another plaintiff’s injury in support of [its] own … claim” to show it engaged in protected activity. Id. at 554 . 12 No. 20-1868 To the extent that Fisk advances a retaliation argument based on the exercise of free speech rights through the Attorney Member, that argument was waived.3 Fisk contends that it en- gaged in protected free speech when the Attorney Member filed evidence and witness disclosures implicating Nicklas in the 2017 suit. Cf. id. at 551–52 (reasoning plaintiff’s affidavit supplying his eyewitness account of alleged incident of in- mate mistreatment by prison officials could plausibly amount to protected First Amendment speech). However, Fisk did not frame Count II in the operative complaint as a retaliation claim based on its exercise of its free speech rights. Rather, Count II referred exclusively to “[t]he First Amendment right to petition the government for the redress of grievances [that] extends to the courts in general and is protected activity,” and alleged “[t]hat filing, prosecuting and defending the lawsuit where Defendant Nicklas was discovered as referring to the 3 In its opening brief on appeal, Fisk refers broadly to a single form of protected conduct to satisfy the first prong of its First Amendment retali- ation claim: “the work of one of its principals in parallel litigation.” Then, in reply, Fisk appears to refer to two forms of “protected conduct”: “Par- agraph 139 of the Amended Complaint alleges a retaliation against speech and for accessing the courts, which is also a speech claim.” To the extent Fisk attempts to add a new argument regarding the Attorney Member’s own “access[] [to] the courts,” Fisk may not raise a new theory in its reply brief. United States ex rel. Berkowitz v. Automation Aids, Inc., 896 F.3d 834 , 843 (7th Cir. 2018) (“Arguments raised for the first time in an appellate reply brief are waived.”). However, whether we characterize this argu- ment as two theories or one does not affect the crux of Fisk’s argument: The Attorney Member, acting as Fisk’s agent, engaged in protected con- duct when it participated in the 2017 lawsuit, which in Fisk’s view satis- fied the first prong for a First Amendment retaliation claim. Nor does it affect our analysis. As we stated above, the petition right belonged to the client, and as we explain infra, Fisk never presented the free speech argu- ment to the district court, and therefore it is waived. No. 20-1868 13 Constitution as ‘pesky’ was a protected activity because ‘the First Amendment’s right to petition the government for the redress of grievances extends to the courts in general and ap- plies to litigation in particular.’” In opposition to Nicklas’s Rule 12(b)(6) motion in the district court, Fisk referred to “[t]he right to petition for redress of grievances … includ[ing] the right to file a claim before a judicial body. [Cal. Motor Transp., 404 U.S. at 510 ]. The right to petition provides addi- tional protection for communication specifically aimed at the redress of grievances.” Fisk therefore advances this free speech theory for the first time on appeal. “In civil litigation, issues not presented to the district court are normally forfeited on appeal.” Russian Media Grp., LLC v. Cable Am., Inc., 598 F.3d 302 , 308 (7th Cir. 2010). As a final backstop, Fisk asserts that “[e]ven setting agency principles aside” the First Amendment applies to close par- ties. In Fisk’s view, Nicklas retaliated against the Attorney Member for his protected speech, which then chilled Fisk’s speech. As with its free-speech-retaliation theory described above, Fisk did not argue this close-party theory to the district court below, so we decline to reach it on appeal. Id. (“[I]t will be a rare case in which failure to present a ground to the dis- trict court has caused no one—not the district judge, not us, not the appellee—any harm of which the law ought to take note.” (citation and internal quotation marks omitted)). Because Fisk has not alleged that the corporate entity itself engaged in any protected conduct, its First Amendment claim fails at the outset. 14 No. 20-1868 B. Due Process We consider next Fisk’s claim in Count III that Nicklas de- prived it of its property in violation of the Fourteenth Amend- ment’s Due Process Clause. Relying on our decision in Bar- rows v. Wiley, 478 F.3d 776 (7th Cir. 2007), the district court ex- plained that Fisk had no constitutionally protected property interest because the PDA and contract for the purchase pro- vided only “a right to acquire the property,” not a right in the property itself, see id. at 780 . To prevail on a procedural due process claim, a plaintiff must make a threshold showing that it “possessed a constitu- tionally protected property interest.” Kim Constr. Co., Inc. v. Bd. of Trs. of Vill. of Mundelein, 14 F.3d 1243 , 1245 (7th Cir. 1994) (citing Cleveland Bd. of Educ. v. Loudermill, 470 U.S. 532 , 538 (1985)). “A property interest for purposes of the Due Process Clause is created by ‘existing rules or understandings that stem from an independent source such as state law—rules or understandings that secure certain benefits and that support claims of entitlement to those benefits.’” Id. at 1245–46 (quot- ing Bd. of Regents v. Roth, 408 U.S. 564 , 577 (1972)). But as we reiterated in Kim, “property is what is securely and durably yours under state … law, as distinct from what you hold sub- ject to so many conditions as to make your interest meager, transitory, or uncertain.” Id. at 1246 (alteration in original) (quoting Reed v. Village of Shorewood, 704 F.2d 943 , 948 (7th Cir. 1983), overruled on other grounds by Brunson v. Murray, 843 F.3d 698 (7th Cir. 2016)). On appeal, Fisk argues that the Resolution and PDA cre- ated a specific property right to the incentive. Alternatively, Fisk contends that the business relationship created by the No. 20-1868 15 Resolution, the contract to purchase the underlying land (which was contingent on receipt of the incentive), and the right to zoning approval were, on their own, each sufficient for Fourteenth Amendment purposes. Fisk’s argument that the Resolution created a protectable interest fails. We have stated that “[t]o demonstrate a prop- erty interest worthy of protection under the [F]ourteenth [A]mendment’s [D]ue [P]rocess [C]lause, a party may not simply rely upon the procedural guarantees of state law or local ordinance.” Cain v. Larson, 879 F.2d 1424 , 1426 (7th Cir. 1989). “[O]nly when the mandated procedure contains within it a substantive liberty or property interest” can such “purely procedural rules of … local law” give rise to a due process claim. Lavite v. Dunstan, 932 F.3d 1020 , 1033 (7th Cir. 2019). The Illinois Supreme Court has pronounced that “[a] resolu- tion or order is not a law, but merely the form in which the legislative body expresses an opinion.” Chi. & N. Pac. R.R. Co. v. City of Chicago, 51 N.E. 596 , 598 (Ill. 1898). The existence of the Resolution alone thus does not suffice to create a protected property interest; Fisk must identify some other “substantive liberty or property interest embedded within [relevant] pro- cedural regulations.” Lavite, 932 F.3d at 1034. Fisk has not met that burden, as the plain language of the Resolution belies Fisk’s characterization of it as “non-discre- tionary,” i.e., as offering anything more than procedural rights. The Resolution was entitled “Authorizing A Prelimi- nary Development Incentive Agreement,” and the City Coun- cil resolved that “[s]taff is authorized to negotiate and pro- ceed with presentation of Final Development Agreement for consideration of approval at a future date.” (Emphases added). By its own terms, the Resolution did not bind or 16 No. 20-1868 otherwise “substantively limit[]” the City “by mandating a particular result when certain clearly stated criteria are met.” See Kim, 14 F.3d at 1248 (“Where ‘the requisite ... mandatory language’ is lacking, no protected interest is created.” (altera- tion in original) (quoting Ky. Dep’t of Corr. v. Thompson, 490 U.S. 454 , 464 (1989))); Hohmeier v. Leyden Cmty. High Schs. Dist. 12, 954 F.2d 461 , 465 (7th Cir. 1992) (“A rule or regula- tion … must have ‘binding force’ in order to create constitu- tionally protected property.”). We therefore agree with the district court’s conclusion that no constitutionally protected property interest arose from the Resolution. The clear lack of binding language also defeats Fisk’s un- supported assertion that the PDA created a protectable inter- est. The PDA was riddled with discretionary language. True, the PDA states, “the Parties agree and acknowledge that the Development Incentive as described herein is necessary in or- der to induce this project to occur, and satisfies all require- ments applicable to such an incentive.” However, tellingly, Fisk itself describes the PDA as a “mandatory consideration of the project.” (Emphasis added). The PDA provided that Fisk “acknowledge[d] that the City is not required to provide the incentive contemplated herein.” Elsewhere, the PDA further stated that until Fisk met all contingencies outlined in the PDA, “it ha[d] no basis to detrimentally rely upon the repre- sentations of the City with respect to the availability of incen- tive funding.” The PDA therefore lacked “sufficient directives to the decisionmaker to support a claim of entitlement” to the Development Incentive. See Kim, 14 F.3d at 1248 . For that same reason, Fisk’s reliance on Barrows is misplaced; unlike Barrows, the parties here did not agree that “a right to” the contract existed. 478 F.3d at 779 . Even setting that issue aside, Barrows offers little help to Fisk, because we held in that case No. 20-1868 17 that the plaintiff did not have a cognizable procedural due process claim. Id. at 781–82. Nor does Fisk’s argument that the Resolution created a “business relationship” affect our analysis. Under Illinois law, the existence of a business relationship may be cognizable for tort protection. See Miller v. Lockport Realty Grp., Inc., 878 N.E.2d 171 , 175 (Ill. App. Ct. 2007). But Illinois tort law only “recognizes that a person’s business relationships consti- tute a property interest” for purposes of creating an “enti- tle[ment] to protection from unjustified tampering by an- other.” Id. (citing Belden Corp. v. InterNorth, Inc., 413 N.E.2d 98 (Ill. App. Ct. 1980)). Illinois tort law does not transform a busi- ness relationship into a constitutionally protected property right. See Reed, 704 F.2d at 948 (urging courts to “look behind labels” and instead “ask whether under Illinois law” the in- terest in question is “securely and durably” the plaintiff’s); see also Rebirth Christian Acad. Daycare, Inc. v. Brizzi, 835 F.3d 742 , 747–48 (7th Cir. 2016) (“[W]hen determining the existence of a property interest … ‘we must look behind labels.’” (quoting Reed, 704 F.2d at 948 )). For the reasons already stated, the Res- olution did not create a constitutionally protected property interest. We find similarly unavailing Fisk’s remaining argument that the underlying contract for the building and the rezoning decision established cognizable constitutional property inter- ests. No cognizable interest stems from the underlying con- tract for the building. The contract was conditioned on the ex- ecution of a final development agreement, and thus that con- tract represented not a secure property interest but rather the hope to acquire one. See Cole v. Milwaukee Area Tech. Coll. Dist., 634 F.3d 901 , 904 (7th Cir. 2011) (“To have a protectable 18 No. 20-1868 property interest in a benefit … a plaintiff must have more than an ‘abstract need or desire for it’ and more than a ‘uni- lateral expectation of it.’” (quoting Roth, 408 U.S. at 577 )). Meanwhile, the contention that Fisk lost “a mechanism for the property to be rezoned” fares no better because the zoning process is merely a “local procedural protection[],” which “do[es] not by [itself] give rise to [a] federal due process inter- est[].” Lavite, 932 F.3d at 1033. Finally, adequate state law remedies remained available to Fisk. The district court relinquished supplemental jurisdiction over Fisk’s state law claims, and whether Nicklas’s or the City’s conduct violated state laws is for the state courts to de- cide. In line with Nicklas’s arguments, “[w]e have similarly held that, regardless of how a plaintiff labels an objectionable land-use decision (i.e., as a taking or as a deprivation without substantive or procedural due process), recourse must be made to state rather than federal court.” CEnergy-Glenmore Wind Farm No. 1, LLC v. Town of Glenmore, 769 F.3d 485 , 489 (7th Cir. 2014). Fisk cannot claim a constitutionally protected property in- terest, and so its procedural due process claim fails at the threshold. Accordingly, the issue of whether Fisk “was af- forded due process before being deprived of that interest does not arise.” Kim, 14 F.3d at 1245 . C. Equal Protection Fisk argues in Count IV that Nicklas singled it out for dis- parate treatment without a rational basis in violation of the Fourteenth Amendment’s guarantee against “den[ial] to any person within its jurisdiction the equal protection of the laws.” U.S. Const. amend. XIV, § 1. Specifically, Fisk claims No. 20-1868 19 that Nicklas, in his role as City Manager, blocked the Devel- opment Incentive arbitrarily and discriminately because of personal animus or favoritism toward other developers. The district court concluded that Fisk pled itself out of court by providing several legitimate reasons for Nicklas’s conduct, defeating any “class of one” equal protection claim under the standard articulated in Miller v. City of Monona, 784 F.3d 1113 , 1121 (7th Cir. 2015) (quoting Village of Willowbrook v. Olech, 528 U.S. 562 , 564 (2000)). Under the Fourteenth Amendment’s Equal Protection Clause, a plaintiff who is not a member of a “protected class” may nonetheless bring a claim under the “so-called ‘class-of- one’ theory.” Fares Pawn, LLC v. Ind. Dep’t. of Fin. Insts., 755 F.3d 839 , 841 (7th Cir. 2014). To state a claim under this theory, a plaintiff must allege “(1) that [it] has been intention- ally treated differently from others similarly situated, and (2) that there is no rational basis for the difference in treat- ment.” Id. at 845 (citing Olech, 528 U.S. at 564 ). For the second criteria, we ask whether “a conceivable rational basis for the difference in treatment” exists. D.B. ex rel. Kurtis B. v. Kopp, 725 F.3d 681 , 686 (7th Cir. 2013). In fact, the rational basis need not even be “the actual justification.” Id. “[A]ny reasonably conceivable state of facts that could provide a rational basis” will suffice. See Scherr v. City of Chicago, 757 F.3d 593 , 598 (7th Cir. 2014) (quoting Lauth v. McCollum, 424 F.3d 631 , 634 (7th Cir. 2005)). We have further clarified that “[i]t is only when courts can hypothesize no rational basis for the action that al- legations of animus come into play.” Flying J Inc. v. City of New Haven, 549 F.3d 538 , 547 (7th Cir. 2008). Fisk is not a member of a protected class, so it proceeds under this class-of-one theory. On appeal, Fisk argues there 20 No. 20-1868 was no rational basis for Nicklas’s conduct. Failing that, Fisk contends that McDonald v. City of Winnetka, 371 F.3d 992 (7th Cir. 2004), held that even if Fisk’s complaint revealed a ra- tional basis, its class-of-one-claim can nonetheless survive be- cause Nicklas blocked the Development Incentive out of ani- mus for embarrassing him in the 2017 lawsuit or favoritism, see id. at 1001 (quoting Olech, 528 U.S. at 564 ). The parties dispute whether Fisk can point to an appropri- ate comparator to satisfy the first criteria for a class-of-one claim, which requires intentionally different treatment from others similarly situated. “Normally, a class-of-one plaintiff will show an absence of rational basis by identifying some comparator—that is, some similarly situated person who was treated differently.” Fares Pawn, 755 F.3d at 845. “[I]f all prin- cipal characteristics of the two individuals are the same, and one received more favorable treatment, this may show there was no proper motivation for the disparate treatment.” Id. (quoting Swanson v. City of Chetek, 719 F.3d 780 , 784 (7th Cir. 2013)). As explained below, however, because we conclude that Nicklas had a rational basis for blocking the Develop- ment Incentive, we need not resolve the issue of whether Fisk can satisfy the first criteria for a class-of-one claim. Id. at 846 (holding summary judgment appropriate where no reasona- ble jury could find “[plaintiff] and the comparator were simi- larly situated, or there was a rational basis for any differential treatment”). We agree with the district court that Fisk’s complaint re- vealed a rational basis to explain why Nicklas recommended termination of the PDA. Relying on Fisk’s own submissions about the corporate entity and principals’ finances, Nicklas ultimately concluded the project was not “financially viable.” No. 20-1868 21 Nicklas’s due diligence revealed that Fisk had “no current or long-term assets that can be pledged as collateral”—other than the prospect of the Development Incentive—to obtain a loan for the estimated approximate $4,600,000 balance needed to pursue the project. Nicklas’s concerns about Fisk’s financial wherewithal to execute the planned multimillion-dollar pro- ject alone qualifies as a “reasonably conceivable state of facts that could provide a rational basis.” Scherr, 757 F.3d at 598 (emphasis omitted) (citation omitted). Likewise, those finan- cial concerns together with the litany of others cited in the City Council’s April 22, 2019, meeting, including Fisk’s failure to submit plans for a traffic study, square footage, storm wa- ter management, and variances and ordinances, could pro- vide a conceivable rational basis for blocking the Develop- ment Incentive. Fisk attempts to cast doubt on Nicklas’s stated reasons for blocking the Development Incentive, but Fisk does not carry its burden to “negative any reasonably conceivable state of facts that could provide a rational basis” for Nicklas’s con- duct. Bd. of Trs. of Univ. of Ala. v. Garrett, 531 U.S. 356 , 367 (2001) (citation and internal quotation marks omitted); Bell v. Duperrault, 367 F.3d 703 , 707 (7th Cir. 2004) (burden lies with plaintiff). Fisk makes three arguments why “[l]ogic, reason, and common sense are missing” from this case, “given the pa- tently and knowingly false statements being publicly re- leased.” First, Fisk appears to assert that Nicklas’s public statements to the media regarding concerns about Fisk repre- sent nothing more than “an orchestrated campaign of retalia- tion” for the 2017 lawsuit and thus evidence illegitimate ani- mus. Fisk thus questions Nicklas’s motivation in blocking the Development Incentive, which we do not consider until we can “hypothesize no rational basis.” Flying J, 549 F.3d at 547 . 22 No. 20-1868 Second, and more relevant on appeal, Fisk challenges Nicklas’s doubts about Fisk’s financial health as a rational ba- sis. However, Fisk does not affirmatively state what working capital or collateral the principals had in hand. Fisk’s general- ized, conclusory argument that Nicklas’s stated reasons for terminating the PDA were “untrue reasons” and were “false, illegitimate claims” does not “negative” Nicklas’s specific doubts about Fisk’s financial health. 4 See id. at 546 (applying Lauth standard on Rule 12(b)(6) motion). In its reply brief, Fisk adds “alleging depend[e]nce on lender financing is an irra- tional dichotomy: if [Fisk] had no working capital or collat- eral, it could not receive lender financing.” It was not irrational for Nicklas to conclude the City should not finance a company that relies solely on those City-provided funds to obtain the remainder of the money needed to complete the project. “The rational-basis requirement sets the legal bar low ….” Kopp, 725 F.3d at 686. Nicklas’s concerns about the use of millions of dollars in taxpayer funds easily clear that bar. Third and finally, Fisk argues that another of Nicklas’s proffered reasons for terminating the PDA, that the entity lacked hotel experience, is not a rational basis either. Fisk con- tends that it should have been “evaluated in its own right sep- arate from its principal members or … only … through its two principal-agent members.” We do not need to opine on whose experience matters: Fisk has not claimed that Fisk or its 4At oral argument, Fisk for the first time affirmatively stated that it had “working capital.” It referred to a March 2019 phone call between Nicklas and the principal’s banker about the principal’s personal finances. Fisk did not raise this argument before the district court, and it is therefore waived. See Jackson v. Parker, 627 F.3d 634 , 640 (7th Cir. 2010). No. 20-1868 23 principals were not inexperienced. 5 Therefore, Fisk has not negated Nicklas’s claim that it was inexperienced as a “con- ceivable” rational basis either. See Miller v. City of Monona, 784 F.3d at 1121–22 (reasoning dismissal is warranted where “the complaint reveals a rational basis … for the actions of [the defendant]”). In sum, the only evidence to which Fisk points to support its position that Nicklas’s reasons were neither legitimate nor true is unavailing. Fisk does not refute any of Nicklas’s con- cerns about Fisk’s financial health or inexperience. The only thing lacking “logic, reason, and common sense” is Fisk’s con- voluted attempt to invalidate these justifications. Even failing to show a valid comparator, Fisk pushes for- ward, insisting that its class-of-one claim can proceed because it has alleged that Nicklas acted on animus flowing from the 2017 litigation. Fisk relies on our decision in McDonald to ar- gue that “the existence of a rational basis is not necessarily fatal” to its case. Specifically, Fisk points to our statement in McDonald that a plaintiff’s burden is an either–or proposition: either “there is no rational basis for the difference in treatment or the cause of the differential treatment is a ‘totally illegiti- mate animus.’” McDonald, 371 F.3d at 1001 (emphasis added). However, since McDonald we have clarified that “[i]t is only when courts can hypothesize no rational basis for the action that allegations of animus come into play.” Flying J, 549 F.3d at 547 . Thus, even assuming Nicklas had an ulterior motive, 5 Fisk’s broad statements that Nicklas’s stated reasons were “untrue” do not suffice here either. Although Fisk affirmatively argued that the princi- pals had experience for the first time during oral argument, it did not raise this argument before the district court or in its briefing on appeal, and it is therefore waived as well. See Jackson, 627 F.3d at 640 . 24 No. 20-1868 the finding of a rational basis is “the end of the matter—ani- mus or no.” Fares Pawn, 755 F.3d at 845. Up to this point, Fisk has not adequately pleaded any of its claims. Fisk’s additional arguments relying on our deci- sions in Esmail v. Macrane, 53 F.3d 176 (7th Cir. 1995), and Swanson v. City of Chetek do not help Fisk because unlike this case, in those cases we did not find a legitimate basis for the state actors’ conduct. See Esmail, 53 F.3d at 179–80 (reversing dismissal where “the unequal treatment is alleged to have been the result solely of a vindictive campaign by the mayor”); Swanson, 719 F.3d at 784–85 (reversing in absence of alternative explanation for government actor’s facially illegit- imate, hostile conduct). Fisk’s allegations do not carry its burden to invalidate Nicklas’s rational basis for blocking the Development Incen- tive. Thus, the only way Fisk could proceed at this juncture would be to identify a sufficiently similar developer with “red flags” regarding its financial wherewithal and other deficien- cies. Fares Pawn, 755 F.3d at 848. Fisk did not do so. Accord- ingly, nothing in the complaint “cause[s] us to question” Nicklas’s treatment of Fisk. See Sung Park v. Ind. Univ. Sch. of Dentistry, 692 F.3d 828 , 833 (7th Cir. 2012). Fisk has therefore failed to state a violation of its Fourteenth Amendment equal protection rights. III. Conclusion For the foregoing reasons, we AFFIRM the opinion of the district court granting defendant’s motion to dismiss.

2021-01-26 21:00:40.769692+00

http://media.ca7.uscourts.gov/cgi-bin/rssExec.pl?Submit=Display&Path=Y2021/D01-25/C:20-2445:J:Sykes:aut:T:fnOp:N:2650164:S:0

In the United States Court of Appeals For the Seventh Circuit ____________________ No. 20-2445 UNITED STATES OF AMERICA, Plaintiff-Appellee, v. GREGORY SANFORD, Defendant-Appellant. ____________________ Appeal from the United States District Court for the Central District of Illinois. No. 12-cr-10069-JES — James E. Shadid, Judge. ____________________ SUBMITTED JANUARY 5, 2021∗ — DECIDED JANUARY 25, 2021 ____________________ Before SYKES, Chief Judge, and ROVNER and BRENNAN, Circuit Judges. ∗ We have agreed to decide the case without oral argument because the briefs and record adequately present the facts and legal arguments, and oral argument would not significantly aid the court. FED. R. APP. P. 34(a)(2)(C). 2 No. 20-2445 SYKES, Chief Judge. Gregory Sanford is serving a 15-year sentence in federal prison for a 2014 cocaine-trafficking conviction. He moved for compassionate release under 18 U.S.C. § 3582 (c)(1)(A), citing the COVID-19 pandemic. He did not, however, exhaust administrative remedies within the Bureau of Prisons before filing his motion. The govern- ment raised the exhaustion problem in the district court and also opposed Sanford’s release request on the merits. The judge skipped over the exhaustion question and proceeded directly to the merits, declining to reduce Sanford’s sentence. Sanford appealed. The government defends the judge’s decision on the merits but again raises the exhaustion problem, arguing that the exhaustion requirement in § 3582(c)(1)(A) is a mandatory claim-processing rule and therefore must be enforced when properly invoked. Three circuits agree and none have held otherwise; we now join the emerging consensus. Sanford failed to comply with the exhaustion requirement before moving for compassionate release. The government properly raised the exhaustion issue in the district court and here. We therefore enforce the requirement and affirm the judgment, though on different grounds. I. Background In 2014 Sanford was convicted in the Central District of Illinois of possession of cocaine with intent to distribute. The judge imposed a sentence of 180 months in prison— 82 months below the bottom of the range recommended by the Sentencing Guidelines. Sanford is currently housed in the federal correctional facility in Victorville, California, and has served roughly half of his sentence. No. 20-2445 3 On April 28, 2020, the warden at the Victorville prison received two written requests from Sanford seeking com- passionate release under § 3582(c)(1)(A) due to the COVID-19 pandemic. Without waiting for a response from the warden or letting 30 days lapse without a response (as the statute requires), Sanford filed a pro se compassionate-release motion in the sentencing court just three days later, on May 1. The court appointed the Federal Defender’s Office to represent him, and counsel filed an amended motion. The amendment focused mostly on the risks of COVID-19 for prison populations generally. At the very end of the motion, however, counsel stated that Sanford “suffers from several health conditions, including stomach pain, shortness of breath, and anxiety,” though no details were provided. On May 14 the warden denied Sanford’s request, ex- plaining that § 3582(c)(1)(A) permits the Bureau of Prisons (“BOP”) to ask the court to reduce a prisoner’s sentence for “extraordinary and compelling” reasons, but as a medically stable 38-year-old and considering the risks of the virus, Sanford’s circumstances did not satisfy this standard. The warden also explained that “[t]he BOP is taking extraordi- nary measures” to prevent the spread of COVID-19. Finally, the warden advised Sanford of his right to pursue an ad- ministrative appeal and explained the process for doing so. Meanwhile, the government responded to Sanford’s amended motion, making two basic points. First, the gov- ernment noted that Sanford failed to comply with the stat- ute’s requirement of administrative exhaustion before filing his motion for compassionate release. The statute provides in relevant part: 4 No. 20-2445 (c) Modification of an imposed term of imprisonment. The court may not modify a term of imprisonment once it has been imposed except that— (1) in any case— (A) the court, upon motion of the Director of the Bureau of Prisons, or upon motion of the defendant after the defendant has fully exhausted all administrative rights to appeal a failure of the Bureau of Prisons to bring a motion on the defendant’s behalf or the lapse of 30 days from the receipt of such a request by the warden of the defendant’s fa- cility, whichever is earlier, may reduce the term of imprisonment … after consid- ering the factors set forth in section 3553(a) to the extent that they are appli- cable, if it finds that— (i) extraordinary and compelling reasons warrant such a reduction … . 18 U.S.C. § 3582 (c) (emphases added). The government argued that the statutory exhaustion requirement, though not jurisdictional, is a mandatory claim-processing rule and must be enforced if invoked. Because Sanford had not complied with the requirement, the government urged the court to deny the motion for this reason alone. Second, the government argued against release on the merits, noting that the Victorville prison did not have any positive COVID-19 cases at that time and that Sanford, as a No. 20-2445 5 38-year-old with no serious medical conditions, had not established that he was at particular risk. A generalized claim of “stomach pain, shortness of breath, and anxiety,” the government argued, was insufficient to satisfy the statute’s requirement of “extraordinary and compelling reasons” for a sentence reduction. In reply Sanford’s counsel noted that the warden had de- nied Sanford’s administrative request on May 14 and urged the court to proceed directly to the merits. The balance of counsel’s reply amplified her earlier arguments about the dangers of COVID-19 to all prisoners. The judge declined to rule on the exhaustion issue and instead addressed Sanford’s motion on the merits, conclud- ing that the “mere presence” of COVID-19 in prison is not an extraordinary and compelling reason for compassionate release. Rather, release might be appropriate when a facility is facing a serious, uncontained COVID-19 outbreak and the prisoner’s medical conditions place him at significant risk of complications from the virus. Because Sanford had not shown that he had an elevated risk for a severe case of COVID-19, the judge declined to reduce his sentence and denied the motion. II. Analysis Section 3582(c)(1) establishes a default rule that the dis- trict court “may not modify a term of imprisonment once it has been imposed,” with a few limited exceptions. At issue here is the so-called “compassionate release” provision, which authorizes a sentence reduction if the court finds that “extraordinary and compelling reasons warrant such a reduction.” § 3582(c)(1)(A)(i). 6 No. 20-2445 Before 2018 compassionate release required a motion from the BOP. United States v. Gunn, 980 F.3d 1178 , 1179 (7th Cir. 2020). The First Step Act of 2018 amended the statute to permit the court to adjudicate a motion directly from the defendant—provided, however, that the defendant must first present his request for compassionate release to the warden and exhaust administrative appeals (if the request is denied) or wait ”30 days from the receipt of such a request by the warden of the defendant’s facility, whichever is earlier.” We have recently held that the exhaustion requirement in § 3582(c)(1)(A) is an affirmative defense, not a jurisdictional prerequisite, so the government will lose the benefit of the defense if it fails to properly invoke it. Id. at 1181. We have not yet directly addressed—that is, not in a published opin- ion—whether the exhaustion requirement is a mandatory claim-processing rule and therefore must be enforced when properly invoked. 1 Several of our sister circuits have held that it is. See United States v. Franco, 973 F.3d 465 , 468 (5th Cir. 2020); United States v. Alam, 960 F.3d 831 , 833–34 (6th Cir. 2020); see also United States v. Raia, 954 F.3d 594 , 597 (3d Cir. 2020) (characterizing the statute’s exhaustion requirement as a “glaring roadblock foreclosing compassionate release”). We agree. The statute plainly uses mandatory language: the court “may not modify a term of imprisonment” on the defendant’s own motion (as opposed to one from the BOP) until “after the defendant has fully exhausted all administra- 1 In a recent unpublished order, we enforced the exhaustion require- ment as a mandatory claim-processing rule. United States v. Williams, 829 F. App’x 138, 140 (7th Cir. 2020). No. 20-2445 7 tive rights to appeal” from the warden’s denial of his request or “the lapse of 30 days from the receipt of such a request by the warden, whichever is earlier.” § 3582(c)(1)(A). This is the language of “a paradigmatic mandatory claim-processing rule.” Franco, 973 F.3d at 468. “If properly invoked, mandatory claim-processing rules must be enforced … .” Hamer v. Neighborhood Hous. Servs. of Chi., 138 S. Ct. 13 , 17 (2017); see Fort Bend Cnty. v. Davis, 139 S. Ct. 1843 , 1849 (2019). The government properly in- voked Sanford’s failure to comply with § 3582(c)(1)(A)’s exhaustion requirement, thoroughly briefing the issue in the district court and on appeal. Though the judge passed over the exhaustion question in favor of a ruling on the merits, a remand for exhaustion factfinding is unnecessary because the facts are not in dispute. Sanford filed his § 3582(c)(1)(A) motion just three days after the warden received his request for compassionate release, without waiting for a response (and pursuing an administrative appeal) or the lapse of 30 days. That resolves this appeal. Although the parties addressed the judge’s ruling on the merits, we do not need to reach those arguments. Because Sanford failed to comply with the statute’s exhaustion requirement, we affirm the denial of his motion for compassionate release. AFFIRMED

2020-01-17 22:01:46.246815+00

Littleton

*84OPINION. Littleton : These petitioners during 1921 were members of a partnership firm of six persons. Under the articles of copartnership they were made the managing partners “ with full, complete, absolute, sole and exclusive power and authority to manage and carry on the said [partnership] business.” To compensate them for the duties and responsibilities which they assumed in their managerial capacities, it was provided in the partnership agreement that the managing partners should “pay to themselves such salary as they may deem reasonable and proper.” It was further provided that the salaries paid to the managing partners “ shall be treated as a part of the' operating expenses of the partnership, and shall not be charged against their interest in the partnership assets or profits.” In 1921 the petitioners, as managing partners, fixed their salaries in the respective amounts set out in the findings of fact, amounting in the aggregate to $21,600, and the salaries so fixed were paid to the petitioners by the partnership in that year. The parties have stipulated that “the results of operations of the partnership for 1921, *85after including as an expense of operations the- salaries of the managing partners as provided in paragraph VI of the partnership agreement quoted above, resulted in a net loss for that year of $12,848.39.” We deduce from that fact that, since the aggregate amount paid to the petitioners as managing partners was $21,600, the net income of the partnership, without any deduction for salaries to partners, amounted to $8,151.61. It was also stipulated that Augustine M., Edward H., and William S. Lloyd, the petitioners, share in the profits or losses of the partnership in the proportions of 22.23, 14.14, and 6.06 per cent, respectively. We are asked to.decide, in the light of these facts, whether, as the Commissioner contends, the amounts which the petitioners received as salaries from the partnership constitute, in their entirety, taxable income derived from salaries, or whether, as the petitioners contend, they are to be treated partly as taxable income from business to the extent of their distributive shares in the partnership net income, the latter to be computed without any deduction for salaries, and partly a£ a return of their capital contributions not subject to tax. While these petitioners received the salaries set out in the findings of fact, it is evident that the amount which each received is not the measure of his gain. The payment of these salaries resulted in a partnership deficit for the year in the amount of $12,848.39 and brought about a corresponding depletion of the partnership assets and of the capital of the partners. There was but one source from which the payments made to the petitioners as salaries, in excess of the partnership earnings, could be made, and that was the capital contributions of the partners. So the gain of each of the petitioners could not be greater than the excess of the amount which he received over and above his proportionate share of the partnership loss. Whether he meets his share of the loss out of his pocket or permits such loss to be charged against his interest in the partnership assets, the answer is the same — he has suffered a depletion in his capital, and we entertain no doubt that this is a factor to be reckoned with in determining each petitioner’s net income. According to the stipulated facts each petitioner’s share in the partnership loss for 1921 is as follows: [[Image here]] Each of the petitioners has suffered a loss of his capital corresponding to his share in the partnership loss, as indicated above. *86The net gain of each, therefore, determined as previously stated, is as follows: [[Image here]] In our opinion the tax should not be levied on any greater amount, in each case, than that shown above as the net gain of each petitioner. We are confronted with the problem then of determining how, under the applicable taxing statute, the income and loss of each petitioner is to be accounted for so that no one of them will be required to pay a tax on any greater amount than that shown above as his net gain. Section 218 (a) of the Revenue Act of 1921 provides as follows: That individuals carrying on business in partnership shall be liable for income tax only in their individual capacity. There shall be included in computing the net income of each partner his distributive share, whether distributed or not, of the net income of the partnership for the taxable year, or, if his net income for such taxable year is computed upon the basis of a period different from that upon the basis of which the net income of the partnership is computed, then his distributive share of the net income of the partnership for any accounting period of the partnership ending within the fiscal or calendar year upon the basis of which the partner’s net income is computed. Speaking with reference to the Revenue Act of 1913, which contained a provision of like purport, the court in United States v. Coulby, 251 Fed. 982, stated as follows: This law [Revenue Act of 1913], therefore, ignores for taxing purposes the existence of a partnership. The law is so framed as to deal with the gains and profits of a partnership as if they were the gains and profits of the individual partner. The paragraph above quoted so provides. The law looks through the fiction of a partnership and treats its profits and its earnings as those of the individual taxpayer. Unlike a corporation, a partnership has no legal existence aside from the members who compose it. The Congress, consequently, it would seem, ignored, for taxing purposes, a partnership’s existence, and placed the individual partner’s share in its gains and profits on the same footing as if his income had been received directly by him without the intervention of a partnership name. So it is under the Revenue Act of 1921. The law ignores the existence of the partnership and deals with the gains and profits thereof as belonging to the partners, who are liable for the income tax thereon in their individual capacities. The partners may take the profits in whatever form and manner and in such proportions as they may agree upon; and the statute holds each accountable and liable for the tax upon the proportion of the profits he is entitled to take under the partnership agreement. *87The distributive share in the net income of a partnership which a partner is required to return includes not only his specific share fixed by the partnership agreement, which in these cases appears to be a proportional one based upon the capital contribution of each partner, but, also, any additional amount which the partner is entitled to take as compensation. In Estate of S. U. Tilton, 8 B. T. A. 914, we had occasion to consider the effect of an agreement to pay compensation to partners, from the standpoint of the Federal taxing statutes. We there announced our conclusion in the matter as follows: It is well settled that partners are not entitled to a salary or compensation for services rendered to the partnership in the absence of an agreement, express or implied, the reason being that the partnership relation imposes upon each member of the firm the obligation to devote his time and abilities to the affairs of the firm. The reward to which each partner is entitled in his right to share in the partnership earnings. Where there has been no agreement otherwise, the partners will share equally in the benefits derived, regardless of the ratio of their contributions,' and irrespective of the form of such contributions. However, the partnership agreement will control. If the partners agree on a proportional distribution of partnership profits, the agreement will be given effect since the courts have recognized the impracticability of determining the relative values of the respective contributions of the individua,! partners. We have heretofore held that partnership profits may be distributed in whatever proportions are determined by the partnership agreement. Appeal of Harriet A. Taylor, 2 B. T. A. 1159. An agreement between partners to pay salaries from profits is nothing more than the determination of a basis for dividing such profits. A partner devoting his time and energies to the business of the firm is in fact working for himself and can not be considered as an employee of the firm in the sense that he is in the service of another. It follows, therefore, that he can not be paid a salary by the firm out of earnings in the sense of compensation for services rendered to an employer. In effect any allowances drawn by a partner from partnership assets are payments which he makes to himself and no man can be his own employer or employee. A partner receiving a salary is merely transferring money from one to another of his own pockets. Leo Schwartz, 7 B. T. A. 223. While that ease was governed by the Revenue Act of 1918 the conclusions reached are equally applicable to these proceedings which are governed by the Revenue Act of 1921. Further, it being concluded that payments of compensation to partners are but a means for dividing the partnership profits, it must necessarily follow that such payments are not proper deductions from income in computing the partnership net income. Therefore,- these petitioners are accountable for their distributive shares in the partnership net income for 1921 of $8,751.61. In article VI of the partnership agreement it is provided that “Any salary which shall be received by the Managing Partners, or *88paid by them on the partnership account, shall be treated as a part of the operating expenses of the partnership.” If this provision means anything, it is that the payments made to these petitioners, as salaries, are to be deducted in arriving at the net profits to be distributed to all of the partners. Since the total salaries paid to the petitioners exceed the net profits of the partnership, before the deduction of salaries, there could have been no profits left for distribution to the other partners. Looking at this situation from the standpoint of the income-tax law, and in the light of our decision in the Tilton case, it is our view that these, petitioners are entitled to take all of the partnership profits up to the aggregate of their salaries, which in 1921 amounted to $21,600, before the remaining partners may share in the profits. It must be held, therefore, that the entire partnership profits for 1921, amounting to $8,751.61, accrued to these petitioners and they are required to account for their respective distributive shares thereof, the distributive share of each being determined upon the basis of the proportion which the amount distributed to him, as compensation, bears to the total amount paid to all three of the petitioners. Thus computed, the distributive share of each petitioner in the partnership net income for 1921 is as follows: Augustine M. Lloyd_$3, 038. 75 Edward H. Lloyd_ ⅞ ¿74.11 William S. Lloyd_ 3,038.75 The payments made to the petitioners by the partnership as salaries exceeded their distributive shares in the partnership net income by the following amounts: Augustine M. Lloyd-$4,461.25 Edward H. Lloyd___ 3,925.89 William S. Lloyd_'_ 4,461. 25 As we have already stated, there was but one source from which the payments made to these petitioners as salaries in excess of the partnership earnings could be made, and that was the capital of all of the partners. We entertain no doubt that to the extent the amount paid to each petitioner was paid out of the capital of the five other partners, it constitutes taxable income to him; but we hold that to the extent it was paid out of his own capital, it represents a return of capital and is not subject to the tax. Thus, we conclude that in addition to their respective distributive shares in the partnership net income Augustine M., Edward H., and William S. Lloyd received taxable income included in the amounts paid to them as compensation of $3,468.40, $2,570.77, and $4,190.90, respectively, computed as follows: *89[[Image here]] In accordance with the foregoing, we hold that, of the payments made to these petitioners by the partnership in 1921 as salaries, the following amounts constitute taxable income. [[Image here]] There remains for consideration the fact ,of the depletion of each petitioner’s capital by his proportionate share of the amounts paid to the other two petitioners, as salaries, in excess of their distributive shares in the partnership net income. In the case of Augustine M. Lloyd, the amount of capital depletion which he must share on account of the payments to Edward H., and William S. Lloyd, in excess of their distributive shares, is 22.23 per cent of $8,387.14, or $1,863.35. In the case of Edward H. Lloyd, the amount is 14.14 per cent of $8,922.50, the excess payments to Augustine M. and William S. Lloyd, or $1,261.64. In the case of William S. Lloyd the amount is 6.06 per cent .of $8,387.14, the excess payments to Augustine M. and Edward H. Lloyd, or $508.26. These capital depletions are ordinary and necessary expenses incurred in carrying on the business of each petitioner, and, as such, are deductible in computing their respective net incomes. Summing up, then, we find that of the amounts paid to Augustine M., Edward H. and William S. Lloyd by the partnership in 1921, the sums of $6,507.15, $6,044.88 and $7,229.65 constitute taxable income to them, respectively, from which there are to be deducted as .ordinary and necessary expenses the sums of $1,863.35, $1,261.64, and $508.26, respectively, leaving a net income of $4,643.80, $4,783.24, and $6,721.39, respectively, which are the actual gains. Since the Commissioner has held that the entire amount received by each petitioner constitutes taxable income, the net incomes determined by the Commissioner should be reduced by $2,856.20 in the case of Augustine M. Lloyd, by $1,816.76 in the case of Edward II. Lloyd, and by $778.61 in the case of William S. Lloyd. Judgment will he entered u/nder Bule 50.

2020-01-17 22:01:46.2766+00

Trammell

*827OPINION. Trammell : We have set forth ..n our findings above the method used by the respondent in computing the average prewar income of the affiliated corporations. The parties have stipulated that the respondent’s result is wrong in that the income of the Massachusetts corporation for the year 1913 was $41,268.43 instead of $35,-721.79 as used by him. It is contended that the Commissioner was in error in computing the average prewar income as he did. The petitioner argues for a method that arrives at the average prewar income of each corporation separately. The following table shows the difference: [[Image here]] *828[[Image here]] Section 320 (b) of the Revenue Act of 1918 provides: The average net income for the prewar period shall be determined by dividing the number of years within that period during the whole of which the corporation was in existence into the sum of the net income for such years, even though there may have been no net income for one or more of such years. Section 310 of the same Act provides: That as used in this title the term “ prewar period ” means the calendar years 1911, 1912, and 1913, or, if a corporation was not in existence during the whole of such period, then as many of such years'during the whole of which the corporation was in existence. Section 330 of the same Act provides: That in the case of the reorganization, consolidation, or change of ownership, after January 1, 1911, of a trade or business now carried on by a corporation, the corporation shall for the purposes of this title be deemed to have been in existence prior to that date, and the net income and invested capital of such predecessor trade or business for ail or any part of the prewar period prior to the organization of the corporation now carrying on such trade or business shall be deemed to have been the net income and invested capital of such corporation. If such predecessor trade or business was carried on by a partnership or individual the net income for the prewar period shall, under regulations prescribed by the Commissioner with the approval of the Secretary, be ascertained and returned as nearly as may be upon the same basis and in the same manner as provided for corporations in Title II, including a reasonable deduction for salary or compensation to each partner or the individual for personal services actually rendered. Under the provisions of section 330, both the corporations are deemed to have been in existence during the prewar years if the businesses to which they succeeded were carried on during those years. The Diamond Shoe Co. of Massachusetts took over the assets and business of a shoe factory in Brockton, Mass., which theretofore had been conducted under the name of the Ideal Shoe Co. This *829occurred in 1912, but there is no evidence as to how long the-business of the Ideal Shoe Co. had been operated. If it had been operated during the prewar years then under the statute, the Diamond Shoe Co. is deemed to have been in business during those years. There is no evidence as to this fact, nor as to the prewar income, if any, during the period prior to July, 1912. It may well be that the business to which the Massachusetts corporation succeeded was in existence, but had no net income other than as stated or used by the respondent. In viewr of this fact, we can not find that the respondent was in error as to the amount of the deficiency. Reviewed by the Board. Judgment will be entered under Rule 50.

2012-04-17 06:25:02+00

http://bulk.resource.org/courts.gov/c/F3/71/71.F3d.882.94-7086.html

71 F.3d 882 Dailey v. Godwin* NO. 94-7086 United States Court of Appeals, Eleventh Circuit. Nov 16, 1995 Appeal From: S.D.Ala., No. 94-00114-P-C 1 AFFIRMED. * Fed.R.App.P. 34(a); 11th Cir.R. 34-3

2020-12-02 07:14:30.606806+00

http://www.search.txcourts.gov/RetrieveDocument.aspx?DocId=16715&Index=%5c%5c10%2e20%2e4%2e7%5cTamesIndexes%5ccoa05%5cOpinion

AFFIRMED and Opinion Filed November 30, 2020 S In The Court of Appeals Fifth District of Texas at Dallas No. 05-16-00671-CV ST. JOHN MISSIONARY BAPTIST CHURCH, SYMPHUEL ANDERSON, BEVERLY DAVIS AND PATRICIA MAYS, Appellants V. MERLE FLAKES, ELOISE SQUARE, MARY JO EVANS, ANNIE KATHERINE WHITE, ELLA MAE ROLLINS, EDDIE ABNEY, GWENDOLYN BROWN, MARK HORTON, DAVID PAILIN, SR., DEE PATTERSON AND PENNY WHITE, Appellees On Appeal from the 160th Judicial District Court Dallas County, Texas Trial Court Cause No. DC-15-04696 MEMORANDUM OPINION ON REMAND Before Justices Schenck, Carlyle,1 and Evans Opinion by Justice Evans In this appeal, appellants St. John Missionary Baptist Church, Symphuel Anderson, Beverly Davis, and Patricia Mays assert that the trial court erred by granting the motion to dismiss and plea to the jurisdiction filed by appellees Merle Flakes, Eloise Square, Mary Jo Evans, Annie Katherine White, Ella Mae Rollins, 1 The Honorable Justice Cory L. Carlyle succeeded the Honorable Douglas Lang, a member of the original panel. Justice Carlyle has reviewed the briefs and the record before the Court. Eddie Abney, Gwendolyn Brown, Mark Horton, David Pailin, Sr., Dee Patterson and Penny White. On original submission, we affirmed the trial court’s judgment based on appellants’ failure to challenge all grounds upon which the trial court could have granted appellees’ motion to dismiss and plea to the jurisdiction. See St. John Missionary Baptist Church v. Flakes, 547 S.W.3d 311 (Tex. App.—Dallas 2018), rev’d, 595 S.W.3d 211 (Tex. 2020). We previously concluded that because appellants had only addressed standing, and failed to address the ecclesiastical abstention doctrine, we had no discretion but to affirm based on Malooly Bros., Inc. v. Napier, 461 S.W.2d 119 (Tex. 1970). St. John Missionary Baptist Church, 547 S.W.3d at 313–14. The supreme court reversed our judgment concluding the ecclesiastical abstention doctrine and standing issues were “so inextricably entwined” that Malooly was inapplicable in this case. St. John Missionary Baptist Church, 595 S.W.3d at 214. The supreme court then remanded the case to this Court. Id. at 216. We now consider the arguments presented in appellees’ motion to dismiss and plea to the jurisdiction and make our determination on the merits. BACKGROUND FOR DECISION ON THE MERITS On September 27, 2014, St. John Missionary Baptist Church (“St. John”) held a specially–called church conference in which a majority of those present voted to terminate Bertrain Bailey’s contract as pastor of St. John. Although Merle Flakes, the chairman of St. John’s trustee board, and Bailey were notified of the vote, Bailey refused to step down and Flakes continued to pay Bailey’s salary. On January 18, –2– 2015, a church conference was held and motions were carried to appoint church officers (including Bailey as pastor), authorize the board of trustees to sell real property owned by the church and the “removal of the Right Hand of Fellowship from the members who filed legal actions in the form of an eviction of the pastor on behalf of St. John Missionary Baptist Church.” Appellants allege that “[m]embers who participated in the Special Called Church Conference received notification that their membership in the church was revoked and appearance on church property [would] resulted [sic] in police interference and their physical removal from the premises.” Appellants, the St. John members who sought to terminate Bailey, sued appellees, the St. John members who supported Bailey, asserting a claim for breach of fiduciary duty as well as equitable relief, including an accounting and injunctive relief. Appellants allege that appellees breached their fiduciary duties to them by failing to “affect the vote of the membership in terminating” Bailey, by continuing to pay Bailey, and by entering into loan contracts on behalf of the church without accounting for such funds. In regard to the injunctive relief, appellants request that appellees be restrained from: (1) using church funds and resources to pay for anything other than payments due on existing loans or mortgages, utility bills, and salaries for the church clerk, musicians and janitorial services; (2) using church funds and resources to directly or indirectly pay Bailey; (3) entering into any transaction that transfers title of ownership from St. John, including the listing of St. –3– John properties for sale; and (4) denying entrance into St. John by the appellants and other “terminated” members. Appellees filed a motion to dismiss and a plea to the jurisdiction based on two arguments—standing and the ecclesiastical abstention doctrine. Appellees attached a copy of St. John’s bylaws to this motion, which included the following provision: The right hand of fellowship will be automatically withdrawn from any member who takes legal action against the church or church leadership without the approval of the Pastor, Board of Trustees and the membership of the church. Appellants assert that appellees fail to make any “allegation as to how, when or even if St. John adopted” this version of the bylaws.2 Appellees also attached what they alleged were instruments from a January 2015 congregational conference at which a majority of church members voted to authorize the sale of church properties and approved a motion supporting the excommunication of the appellants. The trial court granted appellees’ motion without specifying on which issue its decision rested. Appellants appealed and only addressed the standing argument in their appellate brief. This Court affirmed because appellants failed to challenge all possible bases for the decision. As stated above, the supreme court reversed and remanded the case to this Court. We now review the trial court’s decision on the merits. 2 The bylaws dated March 1982 attached to the Second Amended Petition do not contain the provision listed above. –4–  ANALYSIS In their motion to dismiss and plea to the jurisdiction, appellees asserted that the trial court lacked subject-matter jurisdiction and standing to hear the case. A. Plea to the Jurisdiction In their plea to the jurisdiction, appellees assert that the trial court lacked jurisdiction based upon the ecclesiastical abstention doctrine. 1. Standard of Review A plea to the jurisdiction challenges the trial court’s authority to determine the subject matter of a cause of action. Jennison v. Prasifka, 391 S.W.3d 660 , 664 (Tex. App.—Dallas 2013, no pet.) (citing Bland Indep. Sch. Dist. v. Blue, 34 S.W.3d 547 , 554 (Tex. 2000)). A plea questioning the trial court’s subject-matter jurisdiction raises a question of law that we review de novo. Westbrook v. Penley, 231 S.W.3d 389 , 394 (Tex. 2007). Lack of jurisdiction may be raised by a plea to the jurisdiction when religious-liberty grounds form the basis for the jurisdictional challenge. Id. 2. Ecclesiastical Abstention Doctrine The ecclesiastical abstention doctrine arises from the Free Exercise Clause of the First Amendment to the United States Constitution, which is applicable to the states through the Fourteenth Amendment. See U.S. CONST. amend. I (“Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof . . . .”); Jennison, 391 S.W.3d at 664. Government action can burden –5– the free exercise of religion in one of two ways: by interfering with an individual’s observance or practice of a particular faith or by encroaching on the church’s ability to manage its internal affairs. See Jennison, 391 S.W.3d at 664. The broad ecclesiastical abstention doctrine prohibits civil courts from exercising jurisdiction over matters concerning theological controversy, church discipline, ecclesiastical government, or the conformity of the members of the church to the standard of morals required of them. Reese v. Gen. Assembly of Faith Cumberland Presbyterian Church in Am., 425 S.W.3d 625 , 627 (Tex. App.—Dallas 2014, no pet.). However, because churches, their congregations, and hierarchy exist and function within the civil community, the ecclesiastical abstention doctrine does not preclude civil courts from reviewing matters that involve civil, contract or property rights that stem from church controversy. Dean v. Alford, 994 S.W.2d 392 , 395 (Tex. App.—Fort Worth 1999, no pet.). The difficulty arises in determining whether a dispute is ecclesiastical or simply a civil law controversy in which church officials happen to be involved. Tran v. Fiorenza, 934 S.W.2d 740 , 743 (Tex. App.— Houston [1st Dist.] 1996, no writ). Courts must look to the substance and effect of a plaintiff’s complaint to determine its ecclesiastical implication, not its emblemata. Id. For those disputes we can resolve, Texas courts must apply a “neutral principles methodology” meaning they apply neutral principles of law to non-ecclesiastical issues involving religious entities in the same manner as they apply those principles –6– to other entities and issues. El Pescador Church, Inc. v. Ferrero, 594 S.W.3d 645 , 655 (Tex. App.—El Paso 2019, no pet.). In their briefing, appellants frame the argument as whether the following events were conducted in accordance with the church bylaws: (1) the termination of Bailey and (2) the 2015 meeting addressing the sale of the church property and excommunication of members.3 We disagree with this characterization based upon our review of the actual equitable relief sought by appellants and the ecclesiastical implications at issue in this case. i) Termination of pastor Appellants seek to have appellees restrained from using church funds to pay Bailey, and that they only be allowed to use church funds for existing loans or mortgages, utility bills, and salaries for the church clerk, musicians and janitorial services. Such a determination, however, would encroach on the church’s ability to manage its internal affairs because it involves the employment status of the pastor. See Our Lady of Guadalupe Sch. v. Morrissey-Berru, 140 S. Ct. 2049 , 2060 (2020) 3 Appellants assert that their claims do not implicate the ecclesiastical abstention doctrine based on the following argument: Appellants’ claims implicate no theological or ecclesiastical question. At least at present, appellants do not challenge whether Bailey should be terminated, nor do they challenge whether the church’s property should be sold. Instead, their present claims seek adjudication only of whether Bailey was terminated under the bylaws, and whether the 2015 meeting—including the vote on property sales and, apparently, excommunication—was conducted in compliance with the bylaws. The ecclesiastical- abstention doctrine has nothing to do with these claims. –7– (“The independence of religious institutions in matters of ‘faith and doctrine’ is closely linked to independence in what we have termed ‘matters of church government.’ This does not mean that religious institutions enjoy a general immunity from secular laws, but it does protect their autonomy with respect to internal management decisions that are essential to the institution’s central mission. And a component of this autonomy is the selection of the individuals who play certain key roles.”) (internal citations omitted). Texas courts have consistently held that the relationship between an organized church and its ministers is its lifeblood, and matters concerning this relationship must be recognized as of prime ecclesiastical concern. Tran, 934 S.W.2d at 743; Dean, 994 S.W.2d at 395 (a pastor’s ouster is ecclesiastical in nature); Gerard v. South Dallas Missionary Baptist Church, No. 05-01-01612-CV, 2002 WL 31375704 , at *1 (Tex. App.—Dallas Oct. 23, 2002, no pet.) (mem. op.) (“Our review of the record shows the controversy centers around whether the pastor should be voted out of the church. We agree with the Dean court that the issue of a pastor’s ouster is ecclesiastical in nature. The trial court therefore did not have jurisdiction over this case, and did not err in dismissing the case for want of jurisdiction.”) (internal citations omitted). Courts should not involve themselves in matters relating to the hiring, firing, discipline, or administration of clergy. Dean, 994 S.W.2d at 395 . Accordingly, this dispute ultimately concerns matters of church governance in which the court may not intervene. –8–  ii) Denial of entrance to church Appellants also seek to enjoin appellees from “[d]enying entrance into St. John by the Plaintiffs and other terminated members.” In regard to this issue, we note that Texas law clearly states that the question of who may be admitted or excluded from a house of worship is a religious question and we may not intervene in such disputes. Westbrook, 231 S.W.3d at 398 (noting the supreme court has long recognized a structural restraint on the constitutional power of civil courts to regulate matters of religion in general, and of church discipline in particular); Singh v. Sandhar, 495 S.W.3d 482 , 489 (Tex. App.—Houston [14th Dist.] 2016, no pet.) (“Intervenors’ complaint that they were prevented from participating in temple elections, denied membership rights, and removed from the membership list is exactly the type of ecclesiastical matter into which the civil courts cannot constitutionally intervene . . . .”); Retta v. Mekonen, 338 S.W.3d 72 , 77 (Tex. App.— Dallas 2011, no pet.) (“The question of who may be admitted and who may be excluded from a house of worship is a religious question.”). Once again, this dispute concerns ecclesiastical matters in which the court may not intervene. iii) Sale of property In their requested injunctive relief, appellants seek to enjoin appellees from entering into any transaction that transfers title of ownership from St. John, including the listing of St. John properties for sale. With regard to the sale of property, we note, as a general matter, “Texas courts should use the neutral principles –9– methodology to determine property interests when religious organizations are involved.” Masterson v. Diocese of Nw. Tex., 422 S.W.3d 594 , 606 (Tex. 2013). In this case, the church bylaws provide that the Board of Trustees has primary responsibility for matters involving property, personnel, finance and insurance, subject to the report of its actions to the Joint Board and those requiring approval of the church.4 In January 2015, a vote was held to determine whether the Board of Trustees should be given authority to “evaluate church assets and execute agreements that will generate revenue for St. John.” There is also an allegation in appellants’ petition that only members who were in “good standing” were allowed to participate in this vote. Accordingly, the heart of the issue is not whether the Board of Trustees acted in accordance with the bylaws of the church, but whether some members were prevented from voting based upon the church’s interpretation of “good standing.” We cannot make a determination of which members were in good standing with the church without infringing upon the church’s internal membership provisions and disciplinary guidelines. Episcopal Diocese of Fort Worth v. Episcopal Church, 602 S.W.3d 417 , 432–33 (Tex. 2020) (“In sum, TEC’s determinations as to which faction is the true diocese loyal to the church and which 4 Both sets of bylaws submitted contain an almost identical provision. The bylaws submitted by appellants state: “The Trustees will have primary responsibility for matters involving property, personnel, finance and insurance provided that Trustees shall report all matters to Joint Boards and matters requiring approval by the Church shall be submitted to the Joint Boards first.” The bylaws submitted by appellees state: “The Trustees will have primary responsibility for matters involving property, personnel policy, finance and insurance provided that Trustees shall report all matters to the Joint Board. Matters requiring approval by the Church shall be submitted to the Joint Board first.” –10– congregants are in good standing are ecclesiastical determinations to which the courts must defer.”); Westbrook, 231 S.W.3d at 398 (citing Minton v. Leavell, 297 S.W. 615 , 621–22 (Tex. App.—Galveston 1927, writ ref’d)) (courts have consistently applied the ecclesiastical abstention doctrine to matters of church discipline, membership, and expulsion because “a church has a right to decide for itself whom may be admitted into membership, who shall be expelled or excluded from its fold.”). Accordingly, this is not a decision which can be made based on neutral principles of law and we may not intervene. Westbrook, 231 S.W.3d at 398; Singh, 495 S.W.3d at 490; Retta, 338 S.W.3d at 77 . After looking at the substance and effect of the petition to determine its ecclesiastical implication, we conclude that the only proper action for the trial court was to dismiss the case. Because we affirm the trial court’s granting of the motion to dismiss and plea to the jurisdiction based upon the ecclesiastical abstention doctrine, we do not address appellants’ standing argument. CONCLUSION We conclude the trial court did not err in granting the motion to dismiss and plea to the jurisdiction filed by appellees. –11–  Accordingly, we affirm the trial court’s order dismissing the case. /David Evans/ DAVID EVANS JUSTICE Carlyle, J., concurring in judgment only, without opinion 160671F.P05 –12–  S Court of Appeals Fifth District of Texas at Dallas JUDGMENT ST. JOHN MISSIONARY BAPTIST On Appeal from the 160th Judicial CHURCH, SYMPHUEL District Court, Dallas County, Texas ANDERSON, BEVERLY DAVIS Trial Court Cause No. DC-15-04696. AND PATRICIA MAYS, Appellants Opinion delivered by Justice Evans. Justices Schenck and Carlyle No. 05-16-00671-CV V. participating. MERLE FLAKES, ELOISE SQUARE, MARY JO EVANS, ANNIE KATHERINE WHITE, ELLA MAE ROLLINS, EDDIE ABNEY, GWENDOLYN BROWN, MARK HORTON, DAVID PAILIN, SR., DEE PATTERSON AND PENNY WHITE, Appellees In accordance with this Court’s opinion of this date, the judgment of the trial court is AFFIRMED. It is ORDERED that appellees MERLE FLAKES, ELOISE SQUARE, MARY JO EVANS, ANNIE KATHERINE WHITE, ELLA MAE ROLLINS, EDDIE ABNEY, GWENDOLYN BROWN, MARK HORTON, DAVID PAILIN, SR., DEE PATTERSON AND PENNY WHITE recover their costs of this appeal from appellants ST. JOHN MISSIONARY BAPTIST CHURCH, SYMPHUEL ANDERSON, BEVERLY DAVIS AND PATRICIA MAYS. Judgment entered November 30, 2020. –13–

2020-12-02 07:14:30.912152+00

http://www.search.txcourts.gov/RetrieveDocument.aspx?DocId=16783&Index=%5c%5c10%2e20%2e4%2e7%5cTamesIndexes%5ccoa05%5cOpinion

Concurring and Dissenting Opinion Filed November 30, 2020 S In The Court of Appeals Fifth District of Texas at Dallas No. 05-18-00167-CV SARAH GREGORY AND NEW PRIME, INC., Appellants V. JASWINDER CHOHAN, INDIVIDUALLY AND AS NEXT FRIEND AND NATURAL MOTHER OF G.K.D., H.S.D., AND A.D., MINORS, AND AS REPRESENTATIVE OF THE ESTATE OF BHUPINDER SINGH DEOL, ET AL, Appellees On Appeal from the County Court at Law No. 5 Dallas County, Texas Trial Court Cause No. CC-15-02925-E CONCURRING AND DISSENTING OPINION Before the Court sitting En Banc. Concurring and Dissenting Opinion by Justice Whitehill I join the majority opinion save its Part VIII, from which I dissent. Justice Schenck’s dissent highlights important jurisprudential issues regarding the review standards for mental anguish damages in wrongful death cases. His dissent is excellent as far as it goes and standing alone should compel supreme court review of those issues in this case. I write separately because Justice Schenck’s dissent does not go far enough.  I. Moore v. Lillebo Justice Schenck’s dissent stops short because it assumes that Moore v. Lillebo, 722 S.W.2d 683 (Tex. 1986) mandates submitting a mental anguish damages question for every qualifying family member in every wrongful death case regardless of the evidence—or lack thereof—concerning the nature and extent of that family member’s actual resulting mental anguish. Stated differently, he accepts the idea that Lillebo holds that a proper family tie is itself legally some evidence of both the fact of mental anguish injury and the resulting damage amount such that mental anguish damages for the suing family member are presumed and the only question is how much. Indeed, loose language in Lillebo implies that result: Proof of [the parents’] family relationship constitutes some evidence they suffered mental anguish from the wrongful death of their son. The evidence mandates submission of a damage issue on mental anguish. Id. at 686 . But Lillebo does not hold that a required family relationship alone is legally sufficient evidence of the amount of resulting mental anguish damages. Lillebo is not stare decisis precedent for that idea because that issue was not before the supreme court in that case. Thus, any implication to that effect is obiter dicta. More specifically, Lillebo was a no evidence review case concerning the fact of mental anguish injury—not the quantum of related damages. The trial court there declined to submit a mental anguish damage question because there was no evidence that the claimants suffered any physical manifestations of their mental anguish. The –2– supreme court reversed, holding that physical manifestation proof was no longer required to recover mental anguish damages in wrongful death cases: We hold, in a wrongful death cause of action, it is no longer necessary to prove that mental anguish is physically manifested. A physical manifestation of mental anguish is evidence of the extent or nature of the mental anguish suffered, but it is no longer the only proof of mental anguish. Id. (emphasis added). Thus, the factual sufficiency of the evidence supporting an amount of resulting mental anguish damages was not at issue in that case. Furthermore, other parts of Lillebo illuminate that the presumed factum of mental anguish injury is rebuttable and that evidence of more than just a qualifying family relationship is required to prove a recoverable damage quantum amount. For example, the preceding highlighted Lillebo quote recognizes that there are other forms of mental anguish evidence beyond physical manifestation of that injury. To that end, Lillebo recognizes that not all family relationships are loving and caring— indeed some such relationships may be hateful or openly hostile. See id. Additionally, Lillebo quotes extensively from the Eighth Circuit’s exposition of Arkansas law to the effect that mental anguish recoveries are to be based on the emotional impact suggested by the circumstances surrounding the claimant’s loss. Id. (quoting Connell v. Steel Haulers, Inc., 455 F.2d 688 , 691 (8th Cir. 1972)). Thus, Lillebo acknowledges that losing a loved one may well inflict on different family members varying degrees of mental anguish in a range from great pain to none, depending on their interpersonal histories and the circumstances of the –3– loss. That being so, it follows that the presumption of mental anguish injury from the wrongful death of an immediate family member is rebuttable and that some legally sufficient evidence beyond a mere family relationship is necessary to support an awarded mental anguish damage amount. See Nat. Gas Pipeline Co. of Am. v. Justiss, 397 S.W.3d 150 , 161 (Tex. 2012) (conclusory evidence is legally no evidence). Finally, Lillebo also holds that mental anguish, on one hand, and loss of society and companionship, on the other, are separate damage categories that compensate separate types of injuries. 722 S.W.2d at 687–88. Accordingly, loss of society and companionship damages evidence must be different from mental anguish damages evidence so that evidence of the former is no evidence of the latter. But Justice Schenck’s opinion is correct in that, like punitive damages, mental anguish damages awards must be subject to articulable, objective review standards lest they become impermissible arbitrary and due process deficient punishments. II. Application In this specific case, claimants’ sole jury argument for a mental anguish damages amount based on six cents per mile driven has no mooring to any individualized mental anguish suffering or related quantum facts in evidence for any particular plaintiff. As such, it is a naked plea for an emotional, punitive response with no evidentiary support. –4–  Additionally, the jury’s total damages findings show that claimants’ jury argument harmed appellants. Claimants argued that the jury should award total damages of six cents per mile driven in the accident year, which came out to $39 million. That calculation was unmoored to facts concerning the claimants’ actual injuries and arbitrary on its face. Yet, the jury awarded damages totaling $38,801,775, including almost $36 million in noneconomic damages. Moreover, the jury awarded identical sums to several claimants—including claimants from different families. For example, the jury awarded $160,000 for past mental anguish to each of the Vazquezes’ three children, Hector Perales’s son Elijah, two of Deol’s children, and Deol’s parents. It also awarded the three surviving spouses the same $525,000 for past mental anguish damages. These findings suggest that the jury did not make the required individualized determinations rooted in the evidence. –5–  Furthermore, within the Deol family, the jury awarded different family members the same amounts for several noneconomic damages categories. This further indicates that the jury’s fact findings are not rooted in the evidence specific to each claimant.1 First, there is legally no evidence supporting G.D.’s mental anguish damages awards of $5,000 for past mental anguish and $92,500 for future mental anguish. G.D. was seven months old when Deol died and about four and a half years old at trial. Chohan’s sister took care of her when they learned of Deol’s death. There is no evidence that four year old G.D. suffered any past mental anguish at all through trial. Likewise, although G.D. may suffer future loss of companionship injuries and damages for not having her father, on this record it is pure speculation as to how much future mental anguish she will experience from his death. 1 Wife Each Son G.D. Mother Father Loss of past $350,000 $160,000 $160,000 $160,000 $160,000 companionship Loss of future $2,625,000 $1,200,000 $1,200,000 $160,000 $160,000 companionship Past mental $525,000 $160,000 $5,000 $160,000 $160,000 anguish Future mental $3,937,500 $925,000 $92,500 $160,000 $160,000 anguish Total $7,437,500 $2,445,000 $1,457,500 $640,000 $640,000 –6–  Second, the evidence concerning the mental anguish impact of Deol’s death on his father is similarly empty, consisting of evidence that the father is sad. That conclusory evidence is legally no evidence. And even if it were legally some evidence, it would not pass factual sufficiency muster under existing standards. III. Conclusion I write these things not to denigrate the loss most people feel from the wrongful death of an immediate family member. Surely that pain can be real and should be compensated when there is evidence measured against an articulable objective standard supporting it. Accordingly, I urge the supreme court to consider this case and provide guidance in this murky area of the law. /Bill Whitehill/ BILL WHITEHILL JUSTICE Richter, J., joins this opinion 180167DF.P05 –7–

2020-03-06 01:14:44.487135+00

http://www.search.txcourts.gov/RetrieveDocument.aspx?DocId=83624&Index=%5c%5coca%2dpsql12%2ecourts%2estate%2etx%2eus%5cTamesIndexes%5ccoa12%5cOpinion

NO. 12-20-00072-CV IN THE COURT OF APPEALS TWELFTH COURT OF APPEALS DISTRICT TYLER, TEXAS IN RE: § CRAIG MACK, § ORIGINAL PROCEEDING RELATOR § MEMORANDUM OPINION PER CURIAM Craig Mack, acting pro se, filed this original proceeding to request that this Court order Respondent to “respond to all legal documents not previously ruled on and to refrain from further conspiracy, retaliation, deprivation of rights, prohibited racial discrimination – hideous hate crime acts.” 1 Attached to Relator’s petition for writ of mandamus is a lengthy motion, dated February 6, 2020, in which Mack asserts breach of the official oath of office, obstruction of court, and multiple other complaints. 2 The motion is not file marked. In his petition, Relator specifically complains of the lack of a ruling on this motion.3 No other motions are attached to the petition. 1 Respondent is the Honorable C. Michael Davis, Judge of the 369th District Court in Anderson County, Texas. Relator also lists the Anderson County District Clerk as a Respondent. The District Clerk is not a judge over which this Court has mandamus jurisdiction, nor does the record demonstrate that issuance of a writ of mandamus against the District Clerk is necessary to protect this Court’s jurisdiction. See TEX. GOV’T CODE ANN. § 22.221(a), (b) (West 2004) (writ power); see also In re Eaton, No. 12–15–00118–CR, 2016 WL 6876502 , at *1 (Tex. App.–Tyler, Nov. 22, 2016, orig. proceeding) (mem. op., not designated for publication) (appellate court lacked jurisdiction to consider merits of mandamus petition as to district clerk). 2 The record is not clear as to the person or persons designated as Real Party or Parties in Interest. However, in a previous mandamus proceeding involving the same trial court cause number, Bryan Collier, Hillis R. Wilcox, and Kisha Stotts are listed as Real Parties in Interest. See In re Mack, No. 12-19-00238-CV, 2019 WL 3024757 (Tex. App.—Tyler July 10, 2019, orig. proceeding) (mem. op.). 3 Neither Relator’s motion nor his petition is a model of clarity. See TEX. R. APP. P. 38.1(i) (brief must contain clear and concise argument for contentions made); see also Muhammed v. Plains Pipeline, L.P., No. 12-16- 00189-CV, 2017 WL 2665180 , at *2 n.3 (Tex. App.—Tyler June 21, 2017, no pet.) (mem. op.) (pro se litigants are held to same standards as licensed attorneys and must comply with all applicable rules of procedure; otherwise, pro se litigants would benefit from an unfair advantage over parties represented by counsel); Joseph v. Willis, No. 05-16- 00995-CV, 2017 WL 1427713 , at *1 (Tex. App.—Dallas Apr. 18, 2017, no pet.) (mem. op.) (although reviewing  To obtain a writ of mandamus compelling a trial court to consider and rule on a motion, the relator must show that the trial court (1) had a legal duty to perform a nondiscretionary act, (2) was asked to perform the act, and (3) failed or refused to do so. In re Molina, 94 S.W.3d 885 , 886 (Tex. App.–San Antonio 2003, orig. proceeding). Generally, a trial court has a nondiscretionary duty to consider and rule on a motion within a reasonable time. In re Thomas, No. 12–05–00261– CV, 2005 WL 2155244 , at *1 (Tex. App.–Tyler Sept. 7, 2005, orig. proceeding) (mem. op.). However, a trial court cannot be expected to consider a motion not called to its attention. See In re Chavez, 62 S.W.3d 225 , 228 (Tex. App.–Amarillo 2001, orig. proceeding). It is incumbent upon the relator to establish that the motion has been called to the trial court’s attention. See id. Here, Relator has not provided any documentation to demonstrate that he took actions to call his motion to Respondent’s attention. See In re Blakeney, 254 S.W.3d 659 , 662 (Tex. App.— Texarkana 2008, orig. proceeding) (trial court not required to consider motion not called to its attention; even showing motion was filed with clerk does not prove motion was brought to trial court’s attention or was presented to trial court with request for ruling); see also Chavez, 62 S.W.3d at 228 (clerk’s knowledge not imputed to trial court). Even assuming Respondent is aware of the motion and has not ruled, he has a reasonable time in which to rule once the matter is called to his attention. See Thomas, 2005 WL 2155244 , at *1. Whether the trial court has had a reasonable time within which to rule depends on the circumstances of each case, and “no bright- line demarcates the boundaries of a reasonable time period.” Chavez, 62 S.W.3d at 228 . “Its scope is dependent upon a myriad of criteria, not the least of which is the trial court’s actual knowledge of the motion, its overt refusal to act on same, the state of the court’s docket, and the existence of other judicial and administrative matters which must be addressed first.” Id. at 228–29. The record does not demonstrate if or when Relator’s motion was filed, but it is dated February 6, 2020. Relator presents no evidence of the number of other cases, motions, or issues pending on Respondent’s docket, those which have pended on the docket longer than the present case, those pending on the docket that lawfully may be entitled to preferential settings, or Respondent’s schedule. See id. at 229. Therefore, assuming that Relator’s motion was brought to Respondent’s attention, we cannot say that a reasonable time for ruling has passed. See id. at 228– court construes briefing rules liberally, brief fails if it makes a court guess about complaints, search record for facts that may be favorable to party’s position, or conduct legal research that might support contentions made; this is so even if party is pro se and untrained in law). 29; see also In re Halley, No. 03-15-00310-CV, 2015 WL 4448831 , at *2 (Tex. App.—Austin July 14, 2015, no pet.) (mem. op., not designated for publication) (six month delay not unreasonable length of time for motion to remain pending). Accordingly, under these circumstances, Relator has not established his entitlement to mandamus relief. We deny Relator’s petition for writ of mandamus. Opinion delivered March 4, 2020. Panel consisted of Worthen, C.J., Hoyle, J., and Neeley, J.  COURT OF APPEALS TWELFTH COURT OF APPEALS DISTRICT OF TEXAS JUDGMENT MARCH 4, 2020 NO. 12-20-00072-CV CRAIG MACK, Relator V. HON. C. MICHAEL DAVIS, Respondent ORIGINAL PROCEEDING ON THIS DAY came to be heard the petition for writ of mandamus filed by Craig Mack; who is the relator in appellate cause number 12-20-00072-CV and a party to trial court cause number DCCV-19-0862-369, in the 369th Judicial District Court of Anderson County, Texas. Said petition for writ of mandamus having been filed herein on March 2, 2020, and the same having been duly considered, because it is the opinion of this Court that the writ should not issue, it is therefore CONSIDERED, ADJUDGED and ORDERED that the said petition for writ of mandamus be, and the same is, hereby denied. By per curiam opinion. Panel consisted of Worthen, C.J., Hoyle, J. and Neeley, J.

2020-01-17 22:01:46.910705+00

Littleton

*922OPINION. Littleton : In the deficiency notice which forms the basis of this appeal no deduction was allowed on account of the amortization of war facilities, and in the petition as filed error was assigned because of the failure of the Commissioner to make this allowance. However, at that time, full consideration had not been given by the Commissioner to the report of one of his engineers on the claim in question, and on further consideration the Commissioner now admits that some amortization is allowable as a deduction. The pertinent facts, in so far as the parties considered them essential, have been stipulated arid it only remains to make a determination on the basis of these agreed facts. An examination of the record presented shows that the property on which amortization is claimed is divided into two classes, namely, that which was useful only during the period of its operation as a war facility and that which was retained by the petitioner for *923use or employment in its going business. With respect to the first class, the parties have stipulated the amortization allowable, and even as to the second class the parties are in agreement that amortization is allowable on account thereof, but differ as to the amount. It appears further that they are in agreement as to the .costs to be amortized, the capacity of the petitioner’s plant at the close of the amortization period and the production for all years from 1911 to 1927, inclusive. They are also in agreement on the fundamental proposition that in a determination of a “ value in use,” which is our precise issue here, capacity at the close of the amortization period must be compared with production subsequent to this time. Their disagreement relates to the proper production which is to be compared with the agreed capacity, the Commissioner contending that peak production during the post-war period is proper and the petitioner asking that we use average production from 1920 to 1923, inclusive, or, in the alternative, that we use the average production from 1921 to 1923, inclusive. A similar situation arose in Manville Jenckes Co., 4 B. T. A. 765, where the Board was likewise requested to find a value in use and the parties were in agreement that this could be determined by a comparison of war capacity with post-war production. While in the case at bar we have the capacity at the close of the amortization period fixed by agreement and it is only necessary to fix the production comparative, in Manville Jenehes Go., supj-a, it was necessary to determine both the capacity and the production. In arriving at capacity in the Mcmville Jenches case, it was stated that, “we believe that it is entirely within reason that the maximum results actually obtained in any one of the years referred-to (1916 to 1919) for any one of the taxpayer’s mills should be fixed as the measure of the capacity of that mill, and we so decide,” and from these maximum results as a measure, the Board found the capacity of the facilities which were on hand at the close of the amortization period. It will be noted that this was not maximum production attained in any one of the years considered, but rather the maximum production which might reasonably be expected from the facilities on hand at the close of the amortization period, basing such expectation on maximum results attained by the various units over the period considered. Likewise, in the case at bar, capacity is not stipulated at the maximum production reached prior to the end of the amortization period, but something in excess of this amount, which we interpret to mean the maximum production which might reasonably be expected from all facilities which were on hand at the close of the amortization period. This brings us to the real issue or disagreement between the parties: Considering that the parties are agreed that value in use *924may be determined by comparing capacity at the close of the amortization period with production subsequent to this time, what production is to be used? This was likewise before us in the Manville Jenabes case, wherein the Board said: We Lave fixed the capacity of each of the taxpayer’s mills on the basis of the maximum results obtained in any one of the years 1916 to 1919. We believe that the available post-war production should be fixed at a figure representing the total of the maximum production of each of the mills in any one of the years of the post-war period; for, after all, this is the full measure of the actual use of the facilities in the taxpayer’s post-war business, and if maximum capacity is to be used the comparison should be with maximum production. The argument of the petitioner against the application of this method is that the peak year in its case (1923) shows an abnormally high production because of the unusual demand for its product at that time, and attention is further called to statistics compiled by the Department of Commerce for “The Leather Industries” in which a similar high production is shown for 1823 as compared with prior and subsequent years. The petitioner might well have carried the comparison one step further to include the Matwille Jenclces case, where a similar condition is shown to exist. In fact, when we compare the facts in the twro cases (Mawoille Jenabes and case at bar), it is difficult to see how a different conclusion can be reached in the two instances. The petitioner’s argument for average production seems to overlook the fact that it is not average capacity with which it is to be compared, but maximum capacity. If we are to use maximum capacity, it seems only reasonable that Aye should likewise use what represents the maximum use made of this capacity during the post-war period. We do not understand that this employment in its business was dictated other than by the needs of its business, nor do we understand that the petitioner did not profit from this use of its facilities. On the whole, we are satisfied that no facts or consideration have been presented in this case which would justify the application of a different rule from that applied in the Manville. Jenokes case. By this we do not decide, as requested by petitioner, that there may not be situations where it is not proper to use one year’s production during the post-war period as the basis of comparison with maximum capacity for the purpose of determining a deduction of the character in question. What is a reasonable allowance as an amortization deduction is a question of fact to be determined in the light of the circumstances and conditions peculiar to a given case. Judgment will be. entered vjiider Rule 50.

2020-01-17 22:01:46.942816+00

Littleton

*928OPINION. Littleton : The issue here presented arises as the result of a reduction by the Commissioner of petitioner’s invested capital for 1920. In determining .petitioner’s surplus at January 1, 1920, the Commissioner increased the depreciation reserves applicable to de-preciable assets in the amount of $101,512.52, and made a correspond-, ing reduction in surplus of the same amount. This, the petitioner contends, is error for the reason that it represents a reduction in surplus as reflected by petitioner’s books. The returns of the petitioner from 1909 to 1919, inclusive, were introduced in evidence, and show that the depreciation claimed on its returns from 1913 to 1919, inclusive, is in substantial agreement with the evidence submitted as to that written off on its books for the same period, but that for the period 1909 to 1912, inclusive, the total amount claimed as deductions on its excise-tax returns was $163,702.78, whereas the amount written off on its books for this same period was much less than this amount. While we do not know the exact amount written off on its books for depreciation in 1910 and 1911, we do know that in 1909, $25,542.36 was claimed as a deduction on its return and only $2,829.46 set up on its books; that in 1912, $46,485 was claimed as a deduction and only $8,172.37 set up on its books; and that, similarly, the amounts claimed as deductions in 1910 and 1911 were much in excess of the amounts set üp on its books. It also appears that the amount by which the Commissioner had reduced surplus at January 1, 1920, is substantially less than the excess of deductions for depreciation on the returns from 1909 to 1919, inclusive, over that shown on its books for the same period. Little evidence was furnished as to the depreciation actually sustained to January 1,1920, other than may be deduced from the books and returns. The petitioner’s secretary and treasurer, who had been with the company since 1902, did testify that in his opinion the depreciation written off on the books to January 1,1920, was sufficient to take care of the depreciation accrued to that date, though this is difficult of reconcilement with other evidence submitted. He testified that the amount of depreciation written off each year was determined upon at a conference with the president, vice president and himself (this witness). While he stated that the final decision was made by the president and vice president, he stated that he agreed with their *929opinion and judgment. He further testified that the policy of the petitioner had always been to keep everything in excellent repair, making no distinction with respect to the different years, and stating specifically, in reply to a question, that this policy had applied to the Euclid Avenue Building from 1910 to 1919. He stated, further, that charges for repairs were made to expense accounts, and that “ discarded, junked or replaced ” items were charged against the depreciation reserve. While no definite evidence was furnished as to costs, beginning in 1909, it does appear that the greater part of the total costs of $887,995.38, appearing in the depreciable assets at January 1, 1920, was represented by the cost of the Euclid Avenue Building in the amount of $706,580.37. ' This building was completed, equipped and placed in use in 1909, and the earliest cost shown in the returns is for 1915, where we find a cost of $655,000. No substantial additions were shown between 1915 and January 1, 1920, when the cost for this building Avas shown at $706,580.37. The cost of fixtures and machinery on January 1, 1910, v?as $56,399.20. The total capital costs on Avhich depreciation was claimed in 1914 Avas $858,629, as compared with $887,995.38 at January 1,1920. From these facts we think it is fair to say that there Avas no great increase in capital costs on which depreciation was claimed from 1909 to 1920, yet Avhen we examine the depreciation written off on the books, Ave find a variation from $2,829.46 in 1909 and $8,172.37 in 1912 to $47,838.47 in 1919. From the evidence which this witness gave as to the care of the properties, it is difficult to see how we can attach much Aveight to his opinion that the depreciation shoAvn on the books at January 1, 1920, was that accrued to that date, when he also testified that the depreciation written off on the books each year likewise represents the depreciation sustained in each year. Besides, he was not testifying as an expert on depreciation, but only as an officer of the company. We understand this testimony to mean little more than a statement of what depreciation was written off in each of the years. Certainly, it affords little aid in determining that the depreciation Avritten off was that sustained. We are then left with little more than the books and returns as a basis for determining the correctness of the Commissioner’s reduction. The petitioner seems to consider it to be the rule of this Board that the mere presentation of the books, reflecting a given surplus and depreciation reserve, is sufficient to overcome the ‘prima facie correctness of the Commissioner’s determination and to require the Commissioner to go forward with the burden of proof. But we do not understand this to be the case. In Mandel Brothers, 4 B. T. A. 341, where a similar contention was made, the Board said: The Commissioner has determined that a 2 per cent rate for all of the years 1909 to 1920, is reasonable. The taxpayer has not rebutted the prima fade *930case by the mere production of its books. These show only that the return correctly reported the book entries. A line of reasoning which concluded that the presumption of the correctness of the Commissioner’s determination is rebutted by the production of the very evidence which the Commissioner examined and found to reflect an unreasonable allowance and so found not from the books themselves, but from the surrounding circumstances, would be most peculiar. The Commissioner’s allowance does not contradict the fact of what the books showed. It is the determination of a “ reasonable allowance,” and the burden is upon the taxpayer to rebut the presumption of the correctness of that determination. The aforementioned case also distinguishes cases of the type of Cleveland Home Brewing Co., 1 B. T. A. 87; Russell Milling Co.. 1 B. T. A. 194, and Rub-No-More Co., 1 B. T. A. 228, upon which petitioner places much reliance, from cases where there was no substantiation of the book entries as reflecting depreciation actually sustained. In any event, depreciation is a question of fact, and what is shown by books is only evidential and not conclusive. Doyle v. Mitchell Bros. Co., 247 U. S. 179. Besides, is it not reasonable to say that what the books show in this instance is weakened, as evidence of depreciation actually sustained, by the fact that from 1909 to 1912 the petitioner deducted a much greater amount as a “reasonable allowance for depreciation” on its return than that set up on its books? The explanation offered to the effect that the petitioner did not appreciate the significance of such a deduction is not convincing. The petitioner’s secretary and treasurer, who was one of the committee of three who determined this allowance, testified that this was arrived at as the result of the application of specific rates to various types of property, using 2 per cent in the case of buildings and 10 per cent in the case of machinery, which is fairly consistent with the rates claimed in returns for the more recent years. The word “ depreciation ” is not of uncommon usage in the everyday parlance of the average business man, and from the manner in which the deductions on petitioner’s returns from 1909 to 1912 were determined, wo are convinced that its officers were fully conversant with what they were doing when they sought to determine a “ reasonable allowance for depreciation.” When looked at in this light and consideration is given to the great difference between the amount set up on the books from 1909 to 1912 and that deducted on the returns for the same period, would it not be tantamount to imputing fraud to petitioner to say that the amount set up on the books represented what the officers considered the correct depreciation sustained for these years, rather than that claimed on the returns ? And, too, such information as we have as to the cost o’f the depreciable assets and their estimated life as reiterated on several returns, together with evidence as to repairs and maintenance, would tend to discredit rather than substantiate the depreciation reserve as reflected by petitioner’s books. In other words, have not the *931petitioner’s acts and statements in its returns impugned the correctness oí the very books which it asks us to accept in lieu of a determination by the Commissioner which we, under our rules of procedure, must accept as at least prima facie correct? We think so. By the foregoing, we do not purport to find that the depreciation sustained to January 1,1920, is as found by the Commissioner. What we do find is that evidence submitted does not show that the depreciation as set up on the books is correct, nor is it of such character that we can determine what depreciation was sustained. Under such circumstances, there is no alternative than to sustain the Commissioner, even though we are not informed as to the basis of his determination. Judgment will he entered for the respondent.

2020-12-02 07:14:31.431992+00

http://www.search.txcourts.gov/RetrieveDocument.aspx?DocId=16782&Index=%5c%5c10%2e20%2e4%2e7%5cTamesIndexes%5ccoa05%5cOpinion

AFFIRMED; Opinion Filed November 30, 2020 S Court of Appeals In The Fifth District of Texas at Dallas No. 05-18-00167-CV SARAH GREGORY AND NEW PRIME, INC., Appellants V. JASWINDER CHOHAN, INDIVIDUALLY AND AS NEXT FRIEND AND NATURAL MOTHER OF G.K.D., H.S.D., AND A.D., MINORS, AND AS REPRESENTATIVE OF THE ESTATE OF BHUPINDER SINGH DEOL, DARSHAN SINGH DEOL, JAGTAR KAUR DEOL, GUILLERMO VASQUEZ, WILLIAM VASQUEZ, INDIVIDUALLY AND AS ADMINISTRATOR OF THE ESTATE OF ALMA B. (“BELINDA”) VASQUEZ, ALMA J. PERALES, INDIVIDUALLY AND AS ADMINISTRATOR OF THE ESTATE OF HECTOR PERALES AND AS NEXT FRIEND OF MINOR N.P., Appellees On Appeal from the County Court at Law No. 5 Dallas County, Texas Trial Court Cause No. CC-15-02925-E EN BANC OPINION Before the Court En Banc1 Opinion by Justice Reichek Sarah Gregory and New Prime, Inc. appeal a judgment awarding damages to the Estate of Bhupinder Singh Deol and his wife, children, and parents in connection 1 The Court En Banc consists of the 13 current justices as well as the Honorable Martin Richter, Justice, Court of Appeals, Fifth District of Texas as Dallas, Retired, who sat by assignment on the original panel. with Deol’s death following a multi-vehicle collision on Interstate 40 in Texas.2 In twelve issues,3 Gregory and New Prime challenge the sufficiency of the evidence to support various jury findings and assert instances of error in the jury charge and in the striking of designated responsible third parties. For the reasons set out below, we overrule the twelve issues presented and we affirm the trial court’s judgment. BACKGROUND4 This appeal involves a multi-vehicle accident that occurred in the early morning hours of November 23, 2013, on an unlit portion of Interstate 40, after Gregory jackknifed a tractor-trailer she was driving for New Prime. Four people died, and others were injured, as a result of the accident. The tractor-trailers and the vehicles involved in the accident were traveling east on Interstate 40 near the New Mexico–Texas state line. That portion of Interstate 40 is a four-lane highway, two lanes in each direction, with right and left shoulders, and grassy medians between the east- and west-bound lanes and between the shoulders and service roads. 2 One of the vehicles involved in the collision was a van driven by Guillermo Vasquez. He and several family members, identified herein as the Vasquez/Perales family, were also parties to this suit and the judgment included various damage awards to them. During the pendency of this appeal, Gregory and New Prime settled the Vasquez/Perales family’s claims and the Vasquez/Perales family released their judgment. Accordingly, this opinion will address Gregory and New Prime’s complaints as they relate to the Deol family only. 3 Initially, Gregory and New Prime asserted thirteen issues. One of those issues, issue eleven, concerned the Vasquez/Perales family only. Because Gregory and New Prime have settled the Vasquez/Perales family’s claims, we do not consider that issue. TEX. R. APP. P. 47.1. 4 Justice Schenck was the original author of this opinion. The background facts and portions of the analysis in this en banc opinion were adapted from his original opinion. –2–  As Gregory drove the New Prime tractor-trailer east on Interstate 40, she saw the brake lights of two passenger vehicles one-half mile to one mile ahead. She applied the brakes in a firm fashion and the truck slid on a patch of ice. Gregory lost control, and the tractor-trailer jackknifed across the roadway. When it finally came to rest, the cab was partially on the left shoulder with the trailer at an angle, blocking all of the left lane and half of the right lane of traffic. Gregory abandoned the truck without activating its emergency flashers or setting out any reflective triangles or flares despite instructions to do so contained in an “Accident Checklist” in the cab. She returned to the truck when she realized her co-driver, 22-year-old Aaron Ellison, was in the cab’s sleeping berth.5 Gregory roused Ellison, and together they walked through the center median toward the westbound traffic to get to a safe area. Soon afterwards, six tractor-trailers and two passenger vehicles crashed into or around the New Prime truck, the first being a Maryland Trucking Company tractor-trailer driven by Deol. Deol managed to maneuver his truck around the New Prime truck, but was clipped on the right rear side by a Danfreight Systems’ tractor- trailer. Deol stopped his tractor-trailer on the right shoulder and the Danfreight System’s tractor-trailer stopped in the grassy area between the right shoulder and the service road. 5 New Prime hired Gregory approximately three months prior to the accident at issue in this case. After some training, she obtained a commercial driver’s license. She spent several more weeks driving tractor- trailers under the oversight of certified instructors. At the time of the accident, Gregory was classified as a B1 driver, meaning she had to be paired with a certified instructor or an experienced driver. There was evidence adduced at trial that Ellison was only marginally more experienced than Gregory. –3–  An ATG Transportation tractor-trailer then arrived. Its driver steered hard to the right to avoid the New Prime truck, overturning in the process so that the cab was on the grassy area beyond the right shoulder and the back of the trailer protruded onto the right shoulder. At that point, the accident scene appeared as follows with the New Prime tractor-trailer jackknifed, the ATG Transportation tractor-trailer on its side, the Maryland tractor-trailer on the right shoulder, and the Danfreight tractor- trailer ahead on the right grassy median.6 6 The accident scene depictions in this opinion are extracted from exhibits admitted at trial. –4– –5–  Moments later, Guillermo Vasquez, his wife Belinda, their adult son William, their adult daughter Alma Perales, Alma’s husband Hector Perales, and one of the Perales’ sons approached the accident scene in their Chevy van. They were traveling at approximately 30 miles per hour. As Vasquez approached the accident site, he took his foot off the pedal and steered left. The van slid and hit the New Prime truck at approximately 10 miles per hour. No one was injured in that collision. Shortly thereafter, a silver Prius going more than 70 miles per hour came upon the scene. It collided with the rear of the ATG trailer and remained on the right shoulder. Three of the Prius passengers had time to get out of the car and were attempting to extract the fourth. While they were doing so, a P&O Transportation tractor-trailer, driven by Orland Ferrer, arrived on the scene. Ferrer saw the Prius and steered left in an effort to avoid it. At that point, he saw the unlit New Prime trailer jackknifed across the road, but he could not brake quickly enough on the icy road to avoid striking the Vasquezes’ van that was stopped in front of it. After colliding with the Vasquezes’ van, the P&O truck itself was then struck by two other tractor-trailers, one belonging to D.O.D. Reynolds and the other to CDO Express Diversified. All three of the tractor-trailers ended up in the center median. The final accident scene appeared as follows with the New Prime truck on the left shoulder and center median, the Prius and Vasquez van near the Maryland truck, and the Reynolds, P&O, and CDO Express trucks on the center median. –6– –7–  When state troopers arrived at the scene, they discovered multiple people had been killed or seriously injured, including Deol who was lying on the roadway. Accident reconstruction experts concluded that when the P&O truck struck the Vasquez van, it caused the van to roll and run over Deol, killing him. Deol’s wife, Jaswinder Chohan, individually and on behalf of her and Deol’s three children, together with Deol’s estate and Deol’s parents, who lived with Deol’s family, sued Gregory, New Prime, and others for negligence. In addition to claiming New Prime was vicariously liable for Gregory’s negligence, the Deol family asserted direct claims of negligence against New Prime for negligent entrustment, supervision, and training. The Deol family settled their claims against all of the defendants other than Gregory and New Prime. Before trial, Gregory and New Prime designated P&O Transport, ATG Transportation, Danfreight Systems, and their respective drivers as responsible third parties. The Deol family moved to strike these designations, and the trial court granted the motion. The court stated it would reconsider its ruling before submitting the case to the jury. At trial, Gregory and New Prime requested that the trial court instruct the jury on the concepts of sudden emergency, unavoidable accident, and new and independent cause. The trial court granted Gregory and New Prime’s request as to the sudden emergency instruction, but denied their request as to the unavoidable- accident and new-and-independent cause instructions. Ultimately, the trial court –8– asked the jury to decide whether the negligence of Gregory, New Prime, the P&O driver, and Deol proximately caused Deol’s death. The trial court did not ask the jury to consider any negligence on the part of ATG Transportation or Danfreight Systems. The jury answered affirmatively as to causation with respect to Gregory, New Prime, and the P&O driver, and negatively as to Deol himself. The jury apportioned responsibility for Deol’s death as follows: fifty-five percent to Gregory, thirty percent to New Prime, and fifteen percent to the P&O driver. The jury awarded almost $17 million in economic and non-economic damages to the estate and family of Deol, including $500,000 for Deol’s pain and mental anguish. The trial court entered a final judgment stating, in part, the following: At trial it was undisputed that Defendant Sarah Gregory was an employee of Defendant New Prime, Inc. d/b/a Prime, Inc., operating within the course and scope of her employment at the time of the accident. Therefore, Defendant New Prime, Inc. d/b/a Prime, Inc. is vicariously liable for the negligence of Defendant Sarah Gregory and her percentage of responsibility is attributed to Defendant New Prime, Inc. d/b/a Prime, Inc. The judgment awarded the Deol family “actual damages in the sum of sixteen million four hundred forty-seven thousand two hundred seventy-two dollars and thirty-one cents ($16,447,272.31), reflecting settlement credits of four hundred seventy-eight thousand eight hundred thirty dollars and no cents ($478,830.00), from Defendants Sarah Gregory and New Prime, Inc. d/b/a Prime, Inc., which are jointly and severally liable for the entire amount of such sum.” Gregory and New Prime then brought this appeal. –9–  DISCUSSION I. Sufficiency of the Evidence – Negligence In their first issue, Gregory and New Prime assert the evidence is legally and factually insufficient to prove Gregory was negligent. Gregory and New Prime’s legal sufficiency challenge requires us to view the evidence “in the light most favorable to the verdict, and indulge every reasonable inference that would support it.” City of Keller v. Wilson, 168 S.W.3d 802 , 822 (Tex. 2005). The evidence is legally sufficient if “more than a scintilla of evidence exists.” Browning–Ferris, Inc. v. Reyna, 865 S.W.2d 925 , 928 (Tex. 1993). More than a scintilla of evidence exists if the evidence furnishes some reasonable basis for differing conclusions by reasonable minds about a vital fact’s existence. Litton Loan Servicing, L.P. v. Manning, 366 S.W.3d 837 , 840 (Tex. App.—Dallas 2012, pet. denied). The final test for legal sufficiency must always be whether the evidence at trial would enable reasonable and fair-minded people to reach the verdict under review. Del Lago Partners, Inc. v. Smith, 307 S.W.3d 762 , 770 (Tex. 2010). In reviewing Gregory and New Prime’s factual-sufficiency challenge, we “consider and weigh all the evidence, and we should set aside the verdict only if it is so contrary to the overwhelming weight of the evidence as to be clearly wrong and unjust.” Cain v. Bain, 709 S.W.2d 175 , 176 (Tex. 1986). Negligence means a failure to use ordinary care, which is failing to behave as a person of ordinary prudence would have under the same or similar circumstances. –10– Union Pac. R.R. Co. v. Nami, 498 S.W.3d 890 , 896 (Tex. 2016). We conclude the testimony presented at trial from Gregory, Ellison, New Prime’s safety supervisor, the P&O driver, a meteorologist, a motor carrier expert, an accident reconstructionist, and others is legally and factually sufficient to establish Gregory was negligent in multiple ways. The evidence showed this fatal trip began with Gregory and her 22-year-old teammate, Ellison, driving to California to drop off cargo and pick up a load of beer to deliver to North Carolina. Gregory relieved Ellison as driver in Santa Rosa, New Mexico. She had to backtrack several hours in the opposite direction to a casino in Sky City, New Mexico, because Ellison had left his wallet there. Gregory then encountered snow on the way back to Santa Rosa. She experienced problems with the windshield-wiper fluid, causing difficulty seeing out the windshield because of freezing ice. She stopped in Moriarty, New Mexico, to have the problem fixed and then proceeded to travel east toward Amarillo, Texas. Gregory checked the weather while in Moriarty but did not make any effort to obtain updates thereafter. The National Weather Service issued a winter weather advisory covering the relevant time and area, warning of snow, sleet, or freezing rain that could create slippery roads. The temperature was 23 degrees, and there was light freezing drizzle and sleet. The freezing and icy conditions extended west all –11– the way to the state line.7 Despite the weather conditions and running behind schedule, Gregory approached the accident site with the truck’s cruise control set at 58 miles per hour. Experts testified cruise control should not be used when there is precipitation or indications of ice. Gregory acknowledged, and others confirmed, that, if it was precipitating, her speed was in violation of the applicable standard of care, that is to say, not a speed at which a person of ordinary prudence would travel. Gregory testified she lost control of the New Prime truck when she applied a “hard stop” and hit a patch of ice. The jury heard from a safety expert who testified a prudent driver would not apply maximum braking pressure under the conditions Gregory faced.8 One of the other truck drivers involved in the accident testified that, when attempting to stop or slow down, drivers should stab the brake, then let up, stab again, then let up again, because holding the brakes down locks everything up causing the driver to lose control of the vehicle. Significantly, Gregory admitted that, in losing control of the rig, she failed to meet the standard of care required in operating a tractor-trailer. Accordingly, in addition to establishing Gregory failed to recognize adverse weather conditions and drove at an unsafe speed, the evidence 7 Three years after the accident, some of the witnesses did not recall inclement weather at the time of the accident. The jury was free to weigh their testimony against that of the meteorologist and the fact that the evidence showed Gregory encountered ice at the time of the accident. Leibovitz v. Sequoia Real Estate Holdings, L.P., 465 S.W.3d 331 , 351 (Tex. App.—Dallas 2015, no pet.) (factfinder is sole judge of credibility and weight to be given testimony). 8 The expert explained that because there is a tractor and a separate trailer, coupled with a fifth wheel, there is a brake lag, which means there is roughly a half-second delay between when the driver of the tractor applies the brakes and when the brakes are actually applied throughout the entire vehicle. –12– supported a finding that Gregory was negligent in braking in a manner that caused the trailer to jackknife upon encountering ice on the roadway. The evidence regarding negligence addressed not only Gregory’s actions resulting in her truck blocking the roadway, but also her actions after her truck became disabled that were material to creating the resulting pile up. If a parked or disabled vehicle obstructs the road, the operator of the vehicle must act with reasonable promptness to warn other motorists of the vehicle’s presence and to remove the vehicle from the road. Lofton v. Norman, 508 S.W.2d 915 , 919 (Tex. App.—Corpus Christi–Edinburg 1974, writ ref’d n.r.e.); McClellan v. Lee, 426 S.W.2d 635 , 638 (Tex. App.—Houston [1st Dist.] 1968, no writ). Gregory did neither. She failed to activate the truck’s emergency warning flashers, failed to set out reflective triangles or flares, and abandoned her truck in its jackknifed condition on the dark, icy highway blocking most of the eastbound lanes even though she knew that oncoming motorists would have to “fend for themselves, with respect to the hazard [she] created.” Gregory acknowledged that by abandoning the truck she violated the standard of care that New Prime wanted her to follow. Gregory and New Prime contend evidence that the other tractor-trailer drivers who were involved in the accident did not activate any warning systems shows she did not violate the standard of care. Many of the other tractor-trailers, however, managed to clear the roadway and were stopped in a way that did not create a hazard to oncoming traffic. More importantly, the standard of care is determined –13– objectively by what a person of ordinary prudence would have done under the same or similar circumstances. See 20801, Inc. v. Parker, 249 S.W.3d 392 , 398 (Tex. 2008). Accordingly, the conduct of the other drivers does not conclusively establish that Gregory did not violate the objective standard of care. Finally, while the evidence showed Gregory had time to exit her truck, walk away, return to retrieve Ellison, and then again walk to safety, the record does not show that the drivers whose vehicles came upon the scene later and were forced to stop in a manner that blocked the road had the same amount of time to activate a warning system before the fatal events occurred. Gregory attempts to rely on the defense of sudden emergency. The sudden- emergency doctrine applies only if the sudden emergency was not proximately caused by any negligence of the defendant and, after the emergency arises, the defendant acts as a person of ordinary prudence would have acted under the same or similar circumstances. Dillard v. Tex. Elec. Coop., 157 S.W.3d 429 , 432 n.4 (Tex. 2005). As noted above, the evidence established Gregory’s actions before and after her tractor-trailer encountered ice on the roadway were negligent because she failed to recheck the weather, drove with the cruise control activated at an unsafe speed, applied a hard stop as her truck hit the ice, and then failed to warn oncoming traffic of the hazard she created when a reasonably prudent person would have done so. Accordingly, the jury had more than sufficient evidence to reject Gregory and New Prime’s sudden-emergency defense. –14–  Considering and weighing all of the evidence in the record pertinent to the finding of negligence, we determine that there is more than a scintilla of competent evidence to support the jury’s finding, and the finding is not contrary to the overwhelming weight of all the evidence as to be clearly wrong and unjust. Accordingly, we conclude the evidence is legally and factually sufficient to support the jury’s finding Gregory was negligent. II. Sufficiency of the Evidence – Proximate Cause In their fourth issue, Gregory and New Prime also contend the evidence is legally and factually insufficient to support the jury’s finding that Gregory’s conduct proximately caused Deol’s death. Proximate cause has two sub-elements, cause-in- fact and foreseeability. W. Invs., Inc. v. Urena, 162 S.W.3d 547 , 551 (Tex. 2005). Negligence is a cause-in-fact of an injury if (1) the injury would not have occurred without the negligence and (2) the negligence is a substantial factor in causing the injury. Miller v. Lone Star HMA, L.P., No. 05-17-00954-CV, 2018 WL 3991191 , at *2 (Tex. App.—Dallas Aug. 21, 2018, pet. denied) (mem. op.). Foreseeability requires that the negligent actor, as a person of ordinary intelligence, anticipate, or should have anticipated, the danger their negligence created for others. See Nixon v. Mr. Prop. Mgmt. Co., 690 S.W.2d 546 , 549–50 (Tex. 1985). To proximately cause an injury, an actor need not be the last cause, nor commit the act immediately preceding the injury. J. Wigglesworth Co. v. Peeples, 985 S.W.2d 659 , 663 (Tex. App.—Fort Worth 1999, pet. denied) (citing Tex. Power –15– & Light Co. v. Stone, 84 S.W.2d 738 , 740 (Tex. App.—Eastland 1935, writ ref’d)). Moreover, there can be more than one proximate cause of an accident. Travis v. City of Mesquite, 830 S.W.2d 94 , 98 (Tex. 1992). When the new cause or agency concurs with the continuing and co-operating original negligence in working the injury, the original negligence remains a proximate cause of the injury, and the fact that the new concurring cause or agency may not have been reasonably foreseeable should not relieve the wrongdoer of liability. Bell v. Campbell, 434 S.W.2d 117 , 122 (Tex. 1968). Thus, it is no defense that a third person’s negligent act intervened to cause the injury to the plaintiff if the new act cooperates with the still-persisting original negligence of the defendant to bring about the injury. See Rodriguez v. Moerbe, 963 S.W.2d 808 , 819 (Tex. App.—San Antonio 1998, pet. denied). Gregory and New Prime claim Gregory’s negligence was not a cause-in-fact of the collision that killed Deol because the initial accident had come to a rest and intervening conduct became the proximate cause of Deol’s death. Gregory and New Prime also argue that Gregory merely created a condition in which the accident occurred and thus Gregory’s actions were not a proximate cause under controlling Texas law. In support of their contention that the accident had run its course at the time Deol was struck and killed by the Vasquez van, Gregory and New Prime rely on Bell v. Campbell. In Bell, a vehicle pulling a trailer on a highway rear-ended another vehicle. Bell, 434 S.W.2d at 119. During the accident, the trailer broke off and came –16– to rest on the highway. Id. Passers-by then stopped to help move the trailer to the side of the road. Id. As they were doing so, they were struck by another automobile, the driver of which had ignored or failed to see a person flashing a warning signal. Id. The estates of two of the passers-by sued the owner of the trailer for negligence. On appeal, the Texas Supreme Court agreed with the determination by the jury that the negligence of the owner of the trailer did not constitute legal causation. The court stated “[t]he active and immediate cause of the second collision . . . was an entirely independent agency . . . . All forces involved in or generated by the first collision had come to rest, and no one was in any real or apparent danger therefrom.” Id. at 120. The court further held that the defendant’s negligence “did not actively contribute in any way to the injuries . . . . It simply created a condition which attracted [plaintiffs] to the scene . . .” Id. at 122. We observe that while the facts in Bell and this case are similar in part, there are critical differences. The record before us establishes Gregory’s negligence did not merely create a condition which “attracted” Deol to the scene. Rather, Gregory’s negligence caused Deol to take evasive action and then have his truck struck by another tractor-trailer. He was in the zone of danger created by Gregory and that persisted unabated thereafter because of her failure to signal any warning. Thus, unlike the warning provided in Bell before the second driver hit the good Samaritans, here there was no warning before the P&O driver approached the scene colliding with the Vasquez van and pushing it into Deol, causing his death. The jury in this –17– case could readily conclude that the potential danger created by Gregory’s negligence in jackknifing the trailer and in failing to warn oncoming traffic, continued and remained active. Her actions and failure to act continued to create a danger to which those already involved in the accident and those that encountered the scene were exposed. Thus, Gregory’s negligence “actively contributed” to Deol’s peril in the critical time frame. Gregory and New Prime also rely on Union Pump v. Allbritton, 898 S.W.2d 773 (Tex. 1995). That case involved a fire at a Texaco facility, which had been caused by a machine manufactured by Union Pump. Id. at 774. Allbritton, a Texaco employee, assisted in extinguishing the fire. When leaving the scene, Allbritton walked over a pipe rack which was wet with water or foam. Id. She slipped on the rack and injured herself. Id. Allbritton stated the route she took over the pipes was the shorter route but not the safer route. Id. Allbritton admitted she chose the less- safe route because she had a “bad habit” of doing so. Id. Relying on the above- quoted language in Bell, the court held that the negligence of Union Pump was too remote to constitute proximate cause of Allbritton’s injury. Id. at 776. Again, the facts of Union Pump are materially different from those presented here in that the plaintiff in Union Pump was not injured by the danger created by the defendant’s negligence because that danger had ceased to exist. In contrast, Gregory’s negligence in jackknifing the trailer and in failing to warn oncoming traffic created an active danger that continued to exist and contributed to Deol’s –18– death. We further note there are several cases factually similar to this case from this Court and other courts of appeals that likewise distinguish Bell, Union Pump, or both. See, e.g., In re Molina, 575 S.W.3d 76 , 82 (Tex. App.—Dallas 2019, orig. proceeding) (driver’s conduct in darting across roadway did not merely furnish condition that made accident possible, it forced another driver to slow down, which in turn caused collision); Westfreight Sys., Inc. v. Heuston, No. 04-14-00124-CV, 2015 WL 3772397 , at *4 (Tex. App.—San Antonio June 17, 2015, pet. denied) (mem. op.) (driver’s initial negligence in backing 18-wheeler across darkened highway continued to pose danger even after he began moving truck forward); Homeland Express, L.L.C. v. Seale, 420 S.W.3d 145 , 150–51 (Tex. App.—El Paso 2012, no pet.) (driver’s negligence in parking 18-wheeler on part of lane of travel and failing to set out warning devices was proximate cause of collision that occurred thereafter; dangerous situation caused by parking 18-wheeler never abated and forces generated by driver’s conduct had not come to rest at time of collision); Longoria v. Graham, 44 S.W.3d 671 , 676 & n.6 (Tex. App.—Houston [14th Dist. 2001, no pet.) (rejecting argument that plaintiff should have stayed in car instead of exhibiting good Samaritan conduct); Peeples, 985 S.W.2d at 664 (holding that by negligently causing his truck to become disabled on interstate highway and block traffic, defendant was legal cause of subsequent collision; evidence “clearly” established that defendant’s negligence and effects thereof, i.e., traffic backup, had not come to rest); J.D. Abrams, Inc. v. McIver, 966 S.W.2d 87 , 94 (Tex. App.— –19– Houston [1st Dist.] 1998, pet. denied) (defendant highway contractor negligently restricted lanes of traffic, creating slowdowns or stoppages, and causing rear-end collisions; held that effects of its negligence, though negligence apparently had been committed hours earlier, had not ended and caused accident in much more direct sequence than in Bell and Union Pump); Almaraz v. Burke, 827 S.W.2d 80 , 82 (Tex. App.—Fort Worth 1992, writ denied) (defendant negligently lost control of vehicle, leaving it sideways and disabled in overpass; distinguishing Bell, court held defendant was a proximate cause of second collision, which occurred ten minutes after first, because defendant could reasonably foresee his wrecked vehicle causing subsequent collision before preventative action could be taken). We believe the cited cases from our Court and sister courts of appeals are materially on point and are faithful to the guiding principles of law provided by the supreme court that the negligence must be a substantial factor in bringing about the plaintiff’s harm. “The word ‘substantial’ is used to denote the fact that the defendant’s conduct has such an effect in producing the harm as to lead reasonable [people] to regard it as a cause, using that word in the popular sense, in which there always lurks the idea of responsibility . . . .” Lear Siegler, Inc. v. Perez, 819 S.W.2d 470 , 472 (Tex. 1991) (quoting RESTATEMENT (SECOND) OF TORTS § 431 cmt. 1 (1965)). We conclude, based on the evidence presented at trial, the jury could have reasonably concluded that Gregory’s initial negligence in jackknifing the trailer and –20– abandoning the vehicle on a dark, icy highway without warning to oncoming traffic, continued to pose a danger to all motorists who approached the scene thereafter and until the injuries at issue here occurred. All forces involved in or generated by Gregory’s actions had not come to a rest, and others were still in real danger therefrom. III. Apportionment of Liability In their second issue, Gregory and New Prime urge that the apportionment of only fifteen percent responsibility to the P&O driver is against the great weight and preponderance of the evidence. They contend that the finding ignores the fact that no one was hurt until the P&O truck arrived on the scene. The jury is given wide latitude in performing its duty to serve as factfinder in allocating responsibility for an accident pursuant to section 33.003 of the Texas Civil Practice and Remedies Code. Rosell v. Cent. W. Motor Stages, Inc., 89 S.W.3d 643 , 659 (Tex. App.—Dallas 2002, pet. denied). Even if the evidence could support a different percentage allocation of responsibility, an appellate court may not substitute its judgment for that of the jury so long as there was evidence before the jury that can rationally support its conclusions. Samco Props., Inc. v. Cheatham, 977 S.W.2d 469 , 478 (Tex. App.—Houston [14th Dist.] 1998, pet. denied). The jury in this case heard evidence over the course of a three-week trial that Gregory lost control of the tractor-trailer she was driving after hard-braking on ice –21– which resulted in the truck jackknifing. Gregory then abandoned the truck on the highway, leaving it blocking most of both lanes of travel on a dark evening without activating or setting out any warning system or device. By the time the P&O truck arrived on the scene, the ATG Transportation truck and the truck driven by Deol were on the right-side shoulder and grassy area because of the hazard created by Gregory’s abandoned vehicle. Because Gregory failed to activate any warning system, the P&O driver did not see the New Prime trailer until he was nearly upon it. The accident reconstructionist testified none of the collisions, including the P&O truck’s collision with the Vasquez van, would have occurred if Gregory’s trailer had not been blocking the roadway. Based upon this evidence, we cannot find reversible error in the jury’s allocation of only fifteen percent of the responsibility to P&O. IV. Responsible Third Parties In their third issue, Gregory and New Prime contend the trial court erred in striking their designation of ATG Transportation and Danfreight Systems as potentially responsible third parties. Texas law allows a tort defendant to designate a person as a “responsible third party.” TEX. CIV. PRAC. & REM. CODE §33.004(a). The designation’s purpose is to have facts relating to that third party submitted to the trier of fact as a possible cause of, or contributing factor to, the claimant’s alleged injury. See id. § 33.003. This may reduce the percentage of responsibility attributed to the defendant, thus ultimately reducing its liability to the claimant. Id. § 33.013. –22–  Once a responsible third party has been designated, and after an adequate time for discovery has passed, a party may move to strike the designation “on the ground that there is no evidence that the designated person is responsible for any portion of the claimant’s alleged injury or damage.” Id. § 33.004(l); In re Yamaha Golf-Car Co., No. 05-19-00292-CV, 2019 WL 1512578 , at *1 (Tex. App.—Dallas Apr. 8, 2019, orig. proceeding) (mem. op.). When confronted with a motion to strike, a defendant must produce sufficient evidence to raise a genuine issue of fact regarding the designated person’s responsibility for the claimant’s injury. In re Yamaha, 2019 WL 1512578 , at *1. A trial court may not submit a question to the jury regarding the conduct of any person without sufficient evidence to support the submission. Id. § 33.003(b). A party has produced sufficient evidence to support submission of a question to the jury when it provides more than a scintilla of evidence of potential responsibility for the claimed injury. Elbaor v. Smith, 845 S.W.2d 240 , 243 (Tex. 1992) (citing Roy v. Howard-Glendale Funeral Home, 820 S.W.2d 844 , 846 (Tex. App.—Houston [1st Dist.] 1991, writ denied)). This occurs when the evidence “rises to a level that would enable reasonable and fair-minded people to differ in their conclusions” concerning a party’s responsibility for an injury. King Ranch, Inc. v. Chapman, 118 S.W.3d 742 , 751 (Tex. 2003) (quoting Merrell Dow Pharms., Inc. v. Havner, 953 S.W.2d 706 , 711 (Tex. 1997)). A party has produced less than a scintilla of evidence “when the evidence is ‘so weak as to do no more than create a –23– mere surmise or suspicion’ of a fact.” Id. (quoting Kindred v. Con/Chem, Inc., 650 S.W.2d 61 , 63 (Tex. 1983)). The trial court’s ruling on a motion to strike presents a legal question. Ham v. Equity Residential Prop. Mgmt. Servs., Corp., 315 S.W.3d 627 , 631 (Tex. App.— Dallas 2010, pet. denied). Thus, our review is de novo. Molina, 575 S.W.3d at 80 . The Deol family moved to strike Gregory and New Prime’s designation of ATG Transportation and Danfreight Systems, arguing there was no evidence these parties proximately caused the death of Deol. When presenting evidence to a court to defeat a motion to strike a designation of a responsible third party, a party must specifically identify the supporting proof on file that it seeks to have considered by the trial court. In re Transit Mix Concrete & Materials Co., No. 12-13-00364-CV, 2014 WL 1922724 , at *5 (Tex. App.—Tyler May 14, 2014, orig. proceeding) (mem. op.). Neither this Court nor the trial court is required to wade through a voluminous record to marshal a party’s proof. Id. First, Gregory and New Prime argue that, because the evidence established Guillermo Vasquez and the P&O truck moved to the left to avoid colliding with the ATG Transportation truck that had come to rest on the right grassy median, they fulfilled their obligation to raise a genuine fact issue as to the cause of Deol’s death. We disagree. The evidence established the Vasquez van was traveling at a low rate of speed when it approached the accident site. Because Gregory did not activate a warning –24– signal, Guillermo Vasquez had no notice of the presence of that truck until he came upon it in the dark. The evidence showed that, but for Gregory’s vehicle blocking the road with no hazard warning signal, Vasquez would have had ample space and time to stop his vehicle and get off the road, notwithstanding the location of the ATG Transportation truck. Because it was due to Gregory’s actions that the Vasquez van was placed in the position it was before being pushed over Deol, the evidence is insufficient to establish that any act or omission by ATG Transportation was a substantial factor in causing Deol’s death. Consequently, the trial court did not err in striking Gregory and New Prime’s designation of ATG Transportation as a responsible third party. As to Danfreight Systems, Gregory and New Prime contend that because (1) the police report indicated the Danfreight truck took evasive action and struck the Maryland truck after the Maryland truck, driven by Deol, began to slow down, (2) Gregory and New Prime’s accident reconstructionist opined that the left side of the Danfreight trailer collided with the right rear corner of the Maryland trailer, and (3) the evidence established Deol exited his truck, there is some evidence Deol “might” not have exited his truck and been run over by the Vasquez van, if his truck had not been hit by the Danfreight truck. This claimed evidence is so weak as to do no more than create a mere surmise or suspicion. In fact, the evidence showed Deol exited his truck to check on other people who were involved in collisions caused by –25– Gregory’s conduct, not because his vehicle was struck.9 Accordingly, Gregory and New Prime did not produce sufficient evidence to support a finding that an act or omission of Danfreight Systems caused Deol’s death. Consequently, the trial court did not err in striking Gregory and New Prime’s designation of Danfreight Systems as a responsible third party. V. Jury Instruction In their fifth issue, Gregory and New Prime urge that, although the trial court instructed the jury on sudden emergency,10 it improperly refused to instruct the jury on the doctrine of unavoidable accident. A trial court has considerable discretion to determine proper jury instructions, and we review a trial court’s decision to submit or refuse a particular instruction for an abuse of discretion. Thota v. Young, 366 S.W.3d 678 , 687 (Tex. 2012). Unavoidable accident is an inferential rebuttal defense. Dillard, 157 S.W.3d at 432. The purpose of the unavoidable-accident instruction is to advise the jurors that “they do not have to place blame on a party to the suit if the evidence shows that 9 Gregory and New Prime did not object to testimony from witnesses stating they had been told Deol exited his vehicle to check on others. 10 The trial court instructed the jury on sudden emergency as follows: If a person is confronted by an “emergency” arising suddenly and unexpectedly, which was not proximately caused by any negligence on his or her part and which, to a reasonable person, requires immediate action without time for deliberation, his or her conduct in such an emergency is not negligence or failure to use ordinary care if, after such emergency arises, he or she acts as a person of ordinary prudence would have acted under the same or similar circumstances. –26– conditions beyond the party’s control caused the accident.” Id. (citing Reinhart v. Young, 906 S.W.2d 471 , 472 (Tex. 1995)). An unavoidable accident is “an event not proximately caused by the negligence of any party to it.” Reinhart, 906 S.W.2d at 472. An instruction on unavoidable accident is “most often used to inquire about the causal effect of some physical condition or circumstance such as fog, snow, sleet, wet or slick pavement, or obstruction of view, or to resolve a case involving a very young child who is legally incapable of negligence.” Id. The doctrine of sudden emergency is subsumed by the broader doctrine of unavoidable accident. Id. at 474. Thus, the trial court would have been required to submit an unavoidable accident instruction only if the evidence showed the existence of an unavoidable accident that was not a sudden emergency. See Columbia Rio Grande Healthcare, L.P. v. Hawley, 284 S.W.3d 851 , 855 (Tex. 2009). During deliberations, the jury sent a note asking “Does a degre[e of] negligence or external factor not represented as a cause that contributed in question 2 get taken into account in determining losses?” Gregory and New Prime argue this note suggests the jury wanted to factor black ice into its deliberations. Question 2 concerned the apportionment of responsibility of those found negligent in causing the deaths of Belinda Vasquez and Hector Perales and the injuries to the Vasquez and Perales parties. The jury’s inquiry was not tied to a negligence and proximate cause question. –27–  Gregory and New Prime acknowledge that their primary line of defense was their contention that black ice caused Gregory and others to lose control of their vehicles. On appeal, Gregory and New Prime claim the sudden-emergency instruction extended only to Gregory’s failure to take action once she was stopped and facing traffic and did not cover their assertion that Gregory jackknifed the trailer because of black ice. But Gregory and New Prime’s contention fails to recognize that an unavoidable-accident instruction is proper only when there is evidence that the event was not proximately caused by the negligence of any party to the event. Hill v. Winn Dixie Tex., Inc., 849 S.W.2d 802 , 803 (Tex. 1992). It is not error to refuse or fail to give an unavoidable-accident instruction where the evidence shows the accident was in fact avoidable in the exercise of due care. See W. W. Allen, Annotation, Instructions on unavoidable accident, or the like, in motor vehicle cases, 65 A.L.R.2d 12 (1959). We conclude that the evidence in this case does not raise the issue of unavoidable accident. While Gregory may have encountered ice on the roadway, the evidence established she was negligent before she encountered the ice. More particularly, the evidence established she failed to safely operate her vehicle based on conditions that existed at the time of the accident, she was traveling at a speed –28– that was excessive under the circumstances,11 she had the cruise control activated when it was not appropriate to do so, and she hard-braked on the ice when she should not have done so. The safety expert testified commercial drivers are expected to understand the concept of black ice and to check the weather and avoid excessive speed and reliance on cruise control because of the risks it poses. Had Gregory checked the weather, maintained a proper speed, not activated the cruise control, and not hard-braked, she could have avoided losing control of her vehicle. Because Gregory did not take adequate precautions, she was precluded from relying on “unavoidable accident” as a defense. See Hyatt Cheek Builders- Eng’s Co. v. Bd. of Regents of Univ. of Tex. Sys., 607 S.W.2d 258 , 266–67 (Tex. App.—Texarkana 1980, writ dism’d) (trial court did not err in refusing to submit instruction on unavoidable accident because reasonably prudent contractor should have foreseen soil movement that led to pipe break); Otis Elevator Co. v. Shows, 822 S.W.2d 59 , 63 (Tex. App.—Houston [1st Dist.] 1991, writ denied) (“An ‘unavoidable accident’ is one that ordinary care and diligence could not have prevented, or one which could not have been foreseen or prevented by the exercise of reasonable precautions.”). Consequently, the evidence presented did not compel the trial court to submit the question of whether a non-human factor proximately 11 The safety expert testified that truck drivers are to reduce their speed when adverse conditions exist. The speed should be reduced one-third below the posted speed limit in rainy conditions, one-half the posted speed limit in snowy conditions, and to a crawl in icy conditions. –29– caused the accident. In all events, an unavoidable-accident instruction would not have impacted or exonerated Gregory’s failure to activate the emergency flashers or set out warning devices after she allowed the trailer to jackknife, another basis upon which the jury was entitled to find negligence. Accordingly, we conclude the trial court did not abuse its discretion in refusing to instruct the jury on unavoidable accident. VI. New Prime’s Liability The sixth, seventh, eighth, and ninth issues, concern the jury’s findings on the Deol family’s claims against New Prime for alleged negligent entrustment, supervision, and training. More particularly, New Prime contends there is no evidence of negligent entrustment and the trial court abused its discretion in instructing the jury it could find New Prime liable if it found it negligently supervised Gregory or negligently trained Gregory. In addition, New Prime argues the trial court erred in submitting the negligent entrustment and the defective negligent supervision and negligent training claims without giving a separate blank for each in the liability and apportionment questions, thereby making it impossible to know on what claim the jury found New Prime liable, thereby violating Crown Life Insurance Co. v. Casteel, 22 S.W.3d 378 (Tex. 2000). In addition to asserting New Prime was negligent in entrusting a commercial vehicle to Gregory and in its supervision and training of her, the Deol family claimed New Prime was vicariously liable for Gregory’s actions. Under common law, an –30– employer is generally liable for the tort of its employee “when the tortious act falls within the scope of the employee’s general authority in furtherance of the employer’s business and for the accomplishment of the object for which the employee was hired.” Goodyear Tire & Rubber Co. v. Mayes, 236 S.W.3d 754 , 757 (Tex. 2007) (internal quotation omitted). As stated in the trial court’s judgment, it was undisputed at trial that Gregory was an employee of New Prime acting within the scope of her employment when the collisions occurred. Indeed, in their proposed jury charge, Gregory and New Prime stated: Since NEW PRIME has admitted that its driver was in the course and scope of her employment at the time of the alleged accident and is thus vicariously liable for her negligence, if any, Plaintiffs’ claims against NEW PRIME for respondeat superior and their direct negligence claims for negligent training, supervision, entrustment, and other alleged acts or omissions on the part of NEW PRIME have been rendered moot.12 Consequently, New Prime is jointly and severally liable with Gregory for the damages awarded to the Deol family. See Pierre v. Swearingen, 331 S.W.3d 150 , 154–55 (Tex. App.—Dallas 2011, no pet.) (employer’s vicarious liability derivative of and commensurate with that of employee). The trial court rendered judgment against New Prime as jointly and severally liable with Gregory for the entire amount of the judgment based on the company’s 12 Because New Prime stipulated that Gregory was acting within the course and scope of her employment, a vicarious liability question was not necessary. Cf. Diamond Offshore Mgmt. v. Gudry, 171 S.W.3d 840 , 844 (Tex. 2005) (holding where evidence did not conclusively show employee was acting within scope of employment, instruction or question submitting issue to jury is prerequisite to imposition of vicarious liability). –31– vicarious liability for Gregory’s actions, not on the jury’s finding concerning the company’s direct negligence for entrusting a commercial vehicle to Gregory and in supervising and training her. Because we have already concluded Gregory was properly found liable for negligence, and New Prime’s liability is commensurate with Gregory’s, it is unnecessary for us to address the alternative bases upon which the jury found New Prime liable. VII. Pain and Mental Anguish In their tenth issue, Gregory and New Prime claim no evidence supports a conclusion that Deol experienced conscious pain and suffering in connection with his death. The standard of review for legal sufficiency challenges is set forth earlier in our discussion of Gregory and New Prime’s first issue. We need not address Gregory and New Prime’s assertion that the Deol family’s expert on pain and suffering’s testimony was not reliable because other evidence, including eyewitness Ondre Reynolds’s testimony, supports the jury’s decision to compensate Deol’s estate for his pain and mental anguish. In Texas, a party may recover damages only for pain that is consciously suffered and experienced by the deceased. SunBridge Healthcare Corp. v. Penny, 160 S.W.3d 230 , 248 (Tex. App.—Texarkana 2005, no pet.). The presence or absence of physical pain is an inherently subjective question. Id. We may infer pain and suffering from proof that the deceased had severe injuries. Id. In addition, pain and suffering may be established by circumstantial evidence. Id. –32–  The evidence established Deol died of massive blunt force trauma injuries. His head and chest were flattened when the Vasquez van ran over him. Reynolds, the driver of another tractor-trailer, testified that he saw Deol lying in the road. He described Deol as being in “agonizing pain” and “convulsing.” Reynolds stated, “He was, like, shaking and stuff. Like in pain. He was in pain . . . . He was just rolling around in pain.” Reynolds also stated he saw Deol moving and heard him say “Oh,” indicating consciousness. Reynolds’s testimony, together with the evidence concerning the traumatic injuries Deol sustained, is more than a scintilla of competent evidence to support the jury’s finding Deol experienced conscious pain and suffering. We overrule Gregory and New Prime’s tenth issue. VIII. Non-Economic Damages In their twelfth issue, Gregory and New Prime challenge the non-economic damages awarded to the Deol family as a result of his death. The jury awarded Deol’s six family members, including his wife, his three children, and his parents, non-economic damages totaling $15,065,000. This figure excludes the $500,000 awarded to the estate for Deol’s pain and mental anguish. Broken down by damage category and family member, the jury awarded the following. Wife Son Son Daughter Mother Father Loss of past $350,000 $160,000 $160,000 $160,000 $160,000 $160,000 companionship Loss of future $2,625,000 $1,200,000 $1,200,000 $1,200,000 $160,000 $160,000 companionship –33–  Past mental $525,000 $160,000 $160,000 $5,000 $160,000 $160,000 anguish Future mental $3,937,500 $925,000 $925,000 $92,500 $160,000 $160,000 anguish Total $7,437,500 $2,445,000 $2,445,000 $1,457,500 $640,000 $640,000 Gregory and New Prime concede the Deol family suffered grief and loss as a result of Deol’s death. But they contend the jury awards of non-economic damages suffer four problems. First, Gregory and New Prime claim the awards are excessive because they are disproportionate to the economic damages awarded to these individuals. Second, they contend the damages awarded were not individualized because some of the awards for certain categories of damages were consistent for every member of the Deol family. Third, they argue that the damages awarded were excessive compared to damages awarded or upheld in other wrongful death cases. Finally, they argue that there is not legally or factually sufficient evidence to support these awards and the awards were the result of improper closing argument. We address each of these arguments in turn. A. Economic vs. non-economic damages With respect to Gregory and New Prime’s claim that the awards are excessive because they are disproportionate to the economic damages awarded,13 they cite no controlling authority to support a proportionality requirement in wrongful death 13 The jury awarded Deol’s wife $925,200, his older son, H.D., $139,800, his younger son, A.D., $141,000, his daughter, G.D., $145,800, and his parents $1,200 each in pecuniary damages. –34– cases, and we have found none. Rather, they rely heavily on Bentley v. Bunton, 94 S.W.3d 561 (Tex. 2002) to support their argument. But Bentley is a defamation case brought by a public official, which necessitated a careful review of the non- economic damage award to ensure it did not have a chilling effect on First Amendment-protected speech. As the court noted, “[d]amage awards left largely to a jury’s discretion threaten too great an inhibition of speech protected by the First Amendment.” Id. at 605. With this in mind, the court considered the plaintiff’s $7 million mental anguish award and the $150,000 reputation damage award, and concluded that there was “no evidence” that the plaintiff suffered mental anguish in the amount of $7 million, “more than 40 times the amount awarded him for damage to his reputation.” Id. at 607. In addition to Bentley, appellants also rely on three other cases: Exxon Shipping v. Baker, 554 U.S. 471 (2008); Bishop Abbey Homes v. Hale, No. 05-14- 01137-CV, 2015 WL 9167799 (Tex. App. – Dallas Dec. 16, 2015, pet. denied) (mem. op.); and Gordon v. Redelsberger, No.02-17-00461-CV, 2019 WL 619186 (Tex. App. – Fort Worth Feb. 14, 2019, no pet.) (mem. op.). But, like Bentley, these are not wrongful death cases. Baker addressed questions of maritime law related to the Exxon Valdez oil spill. Baker, 554 U.S. at 475–76. Hale involved faulty construction of the plaintiffs’ “dream home,” and this Court determined the ratio between pecuniary and non-pecuniary damages did not support the mental anguish damages awarded to the two plaintiffs. Hale, 2019 WL 619186 , at *19. And –35– Redelsberger involved a confrontation in a parking lot in which the plaintiff suffered a gash above his eye. The court in Redelsberger affirmed the jury’s award for past and future physical pain and mental anguish, but it suggested a remittitur of damages awarded for past and future physical impairment based on a lack of evidence of losses resulting from any physical impairment. Redelsberger, 2019 WL 619186 , at *14–15. Death is different. In wrongful death cases, the emotional impact of the loss of a beloved person is the most significant damage suffered by surviving relatives. Moore v. Lillebo, 722 S.W.2d 683 , 685 (Tex. 1986). One can experience crushing mental anguish and loss of companionship from the death of a family member even without experiencing significant pecuniary loss. One has little, if anything, to do with the other. As shown in our review of the evidence below, the focus is on the relationship between the decedent and the survivor. Given that mental anguish and loss of companionship are heavily dependent on the relationship between the deceased and the beneficiary, we reject Gregory and New Prime’s proportionality argument.14 14 We acknowledge that our sister court invoked a proportionality requirement in Lane v. Martinez, 494 S.W.3d 339 (Tex. App. – Eastland 2015, no pet.), a wrongful death case. The Lane court, however, based its excessiveness determination on its conclusion that the jury simply picked numbers and put them in the blanks. Id. at 350. Although it did refer to proportionality between pecuniary and non-pecuniary damages as a “benchmark,” it considered proportionality alongside several other factors that supported its ultimate conclusion that the non-pecuniary damages at issue in that case were improper because they were not the result of an individualized analysis. Id. at 351. We also note that Lane is not binding on this Court, and to the extent it suggests that courts of appeal should consider the ratio between economic and non-economic damage in determining excessiveness of non-economic damages in wrongful death cases, we disagree; such –36–  B. Individualization of Awards Next, Gregory and New Prime contend the damages awarded were not individualized because some of the awards for certain categories of damages awarded were consistent for every member of the Deol family. But, under some circumstances, it may be proper to award similarly situated individuals like amounts. See, e.g., JBS Carriers, Inc. v. Washington, 513 S.W.3d 703 , 718 (Tex. App.—San Antonio 2017) (rejecting defendants’ criticism that jury awarded all three adult children “the same amount” for mental anguish and loss of companionship from their mother’s death), rev’d on other grounds, 564 S.W.3d 830 (Tex. 2018). Moreover, the record belies appellants’ contention that the jury simply picked numbers and put them in the blanks. Guillermo Vasquez, Alma Perales, and Deol’s wife, Jaswinder, were the three surviving spouses in this lawsuit. While the jury awarded the three spouses the same amounts in past mental anguish ($525,000) and past loss of companionship ($350,000), they awarded Guillermo significantly less in future mental anguish and loss of companionship compared with Alma and Jaswinder, apparently accounting for Guillermo’s poor health and advanced age. This difference in treatment reflects a careful and sensitive analysis on the part of the jury. As for Alma and Jaswinder, the jury could have determined that both practice is contrary to decades of jurisprudence observing that mental anguish and loss of companionship damages are unliquidated and incapable of precise mathematical calculation. Thomas v. Uzoka, 290 S.W.3d 437 , 454 (Tex. App.—Houston [14th Dist.] 2009, pet. denied) (collecting cases). –37– women were entitled to similar figures – both had been without their husbands for the same amount of time, both of their husbands were killed in the same manner, both learned of their husbands’ deaths in tragic ways, both were left as widows with children to raise and without the primary source of their household’s income, and both women testified compellingly about the closeness of their relationships with their respective husbands. Deol left behind three young children, A.D., H.D., and G.D. At the time of trial, A.D. and H.D. were 12 and 14 years old, respectively, and G.D. was 4 years old. All three children were awarded the same amounts in past and future loss of companionship. A claim for loss of companionship and society asks “what positive benefits have been taken away from the beneficiaries by reason of the wrongful death?” Lillebo, 722 S.W.2d at 688. It is entirely reasonable for the jury to conclude the positive benefits lost would be similar for three young children of the same father, who had been without him, and would be without him in the future, the same amount of time. The evidence at trial established that Deol was a doting father who was heavily invested in all three of his children’s lives, and the jury could have determined that they were deprived of the same benefits because of his death and this deprivation would continue their entire lives. In comparison, the jury did not award the children the same past and future mental anguish awards. G.D., who was an infant when Deol was killed, was awarded significantly less than her brothers. While her brothers were each awarded $160,000 –38– in past mental anguish, the jury awarded G.D. only $5,000. And, although her brothers were awarded $925,000 in future mental anguish, G.D.’s award was one- tenth of this amount, $92,500. The jury clearly considered the differing circumstances of the Deol children and factored them into the awards. Deol’s father, Darshan, and his mother, Jagtar, were each awarded $160,000 across all categories of non-economic damages. The fact that the amounts are equal does not mean they were random or a product of the jury failing to properly deliberate on the amounts each party was entitled to recover. Instead, the equal amounts may easily reflect the similarities of the parents’ situations including their ages (71 and 75 at the time of trial) and that they both lived with Deol and his family at the time of his death. We accord respect to a jury’s award of non-economic damages when the record demonstrates careful consideration of what amounts to assess. A jury demonstrates this level of care where, as here, it awards different claimants different amounts for different categories of non-economic damages. Serv. Corp. Int’l v. Aragon, 268 S.W.3d 112 , 121–22 (Tex. App. – Eastland 2008, pet. denied). Overall, we find that the jury exercised the requisite level of care in determining the non- economic damage amounts awarded to each member of the Deol family and we reject Appellants’ argument that the jury simply picked numbers at random and filled them in the blanks. –39–  C. Comparison with other wrongful death cases Gregory and New Prime also argue that comparing the awards made in this case with awards in similar cases confirms that these awards are excessive. Appellants reference several cases involving “similar circumstances: the death of a spouse, father, and adult child,” and argue generally that the awards at issue are higher than the average awarded in those cases. But each award of non-economic damages is a unique exercise of the jury’s discretion. Primoris Energy Servs. Corp. v. Myers, 569 S.W.3d 745 , 760 (Tex. App.—Houston [1st Dist.] 2018, no pet.) (“‘Because the measure of damages in a personal injury case is not subject to precise mathematical calculation, each case must be measured by its own facts, and considerable latitude and discretion are vested in the jury . . . Therefore, comparison with other cases or amounts of verdicts is ‘generally of little or no help.’” (quoting U-Haul Int’l., Inc. v. Waldrip, 322 S.W.3d 821 , 855-56 (Tex. App.—Dallas 2010), rev’d in part, 380 S.W.3d 118 (Tex. 2012); see also Emerson Elec. Co. v. Johnson, 601 S.W.3d 813 , 845 (Tex. App.—Fort Worth 2018, pet. granted) (mem. op.) (each case must be measured by its own facts, and because appropriateness of award turns on specific facts of case, “referencing the amounts awarded in other cases is of limited help to a court reviewing the sufficiency of the evidence to support an award.”); George Grubbs Enters., Inc. v. Bien, 881 S.W.2d 843 , 858 (Tex. App.— Fort Worth 1994) (comparisons with other cases or verdicts of little help because same loss will result in different damages to different individuals), rev’d on other –40– grounds, 900 S.W.2d 337 (Tex. 1995); Harris v. Balderas, 949 S.W.2d 42 , 44 (Tex. App.—San Antonio 1997, no writ) (explaining there is no certain standard by which personal injury damages can be measured; each case must stand on own facts and circumstances, and comparison with other cases on amounts of verdicts is of little or no help). Other wrongful death cases are informative only insofar as those cases identify relevant factors that can indicate a particular damage award is excessive in light of the evidence presented. Critical Path Res., Inc. v. Cuevas, 561 S.W.3d 523 , 568 (Tex. App.—Houston [14th Dist.] 2018, pet. granted, judgm’t vacated w.r.m.). For example, an award of mental anguish damages may be considered excessive if there is little evidence to show the nature, duration, or severity of the anguish. See id. Because each award must be measured against its own supporting facts, however, a simplistic comparison of the amounts awarded in this case to the amounts awarded in other cases is of no analytical or persuasive value. See id. To successfully mount a challenge to the amount of the award, appellants were required to apply the factors identified in the cases they cite and explain how they show that the awards in this case are excessive based on the facts presented. Id. Appellants made no attempt to do this. The mere fact that the cases they cite are wrongful death cases involving damage awards to family members does not, by itself, explain why the awards in those cases dictate a lesser amount is appropriate here. –41–  D. Legal and Factual Sufficiency Appellants claim that, rather than awarding damages based on specific evidence presented, the jury appears to have started with the $39 million figure counsel for the Vasquez/Perales family suggested in closing argument and worked backwards. In his argument, counsel stated: “But if you don’t like any of the [earlier] analysis with respect to damages, then think about it this way . . . [J]ust give them your two cents’ worth . . . six cents a mile for the six hundred and fifty . . . million miles they traveled in the year that they took these people’s lives. . . . Just give them your two cents’ worth. That’s $39 million.” The jury awards to both the Vasquez/Perales and Deol families totaled $38,801,775. We first address appellants’ argument that the non-economic damage awards in this case were the result of improper closing argument and then review the awards under the applicable standard of review. 1. Counsel’s statement The above statement, made by counsel for the Vasquez/Perales family, came in without objection and without comment by counsel for Gregory and New Prime during their closing argument. This statement was one of many arguments counsel made concerning damages during closing argument, including, but not limited to, the following: The instruction is to compensate in this case. And that is your juror’s call to action. The action required is to equalize the money with the harms and the losses. The word “compensate” in trial –42–  means to balance. And the requirement to compensate means that the weight of the harm must be balanced by the weight of the compensation. And the law in every courthouse in America says nothing goes on the scale but the losses and harms caused by negligence, no outside reason. Your most important job is to make sure everyone follows that law. . . . This is important because if your verdict is for less than the full and fair amount that equalizes the harms, if your verdict is some symbolic amount or some token amount or anything less than the full measure of losses and harms, if you take any outside reason into account even a little, then the law has not been fulfilled. And what are the harms and losses in this case? You’ve heard the evidence. You’ve met the family and heard about what used to be, a wife and a mother gone, a husband and a father gone, incredible pain, physical and emotional suffering, the loss of a limb, the drastic changes to all of their lives. And when I think of Guillermo and his injuries and when I think of Guillermo and losing his wife and his son-in-law, and when I think of William and Alma losing their mother, and when I think of Alma losing her husband, and Noah and Elijah losing their father and their grandmother and an entire generation, two generations of family wiped out and a family destroyed and losses that will go on for (unintelligible), in some cases a combined 50 years, I can’t imagine that you wouldn’t consider the total for those losses somewhere between 30- and 40 million. But that is my suggestion. It is my obligation to give you that. It is your decision and your decision alone. You might think more; you might think less. That would be your call, but that’s my suggestion of awarding to these folks. (Emphasis added). Clearly then, although counsel for the Vasquez/Perales family made the complained-of statement which culminated in a suggestion that the jury award $39 million, that statement must be considered in the context of counsel’s preceding –43– remarks that accurately set out the standards and factors applicable to non-economic damages. Counsel’s comment regarding “six cents a mile” put into perspective the $30 million to $40 million amount he suggested the plaintiffs were entitled to receive based on the facts presented. In addition, counsel for appellees addressed the appropriate factors relevant to non-economic damages during both voir dire and opening statements. Finally, the jury charge correctly instructed the jury on the law to consider in awarding non-economic damages, and unless the record demonstrates otherwise, we presume the jury followed these instructions. Golden Eagle Archery, Inc. v. Jackson, 116 S.W.3d 757 , 771 (Tex. 2003). Appellants point to nothing in the record nor any authority that would provide a rational basis for us to conclude that the complained-of statement led the jury to make its decisions on an improper basis or affected the jury’s award of non-economic damages in this case. 2. Sufficiency of the Evidence In determining whether damages are excessive,15 we employ a factual sufficiency analysis. Pope v. Moore, 711 S.W.2d 622 , 624 (Tex. 1986) (per curiam); Balbuena v. Balbuena ex rel. Balbuena, No. 05-02-00459-CV, 2002 WL 31646678 , at *3 (Tex. App.—Dallas Nov. 25, 2002, no pet.) (not designated for publication). We can set aside a verdict only if it is so contrary to the overwhelming weight of the 15 Appellants concede that members of the Deol family experienced some mental anguish and loss of companionship such that these questions were correctly submitted to the jury. Appellants challenge only the amounts of the awards contending they were excessive. –44– evidence that the verdict is clearly wrong and unjust. Ortiz v. Jones, 917 S.W.2d 770 , 772 (Tex. 1996). The nebulous issues of mental anguish and loss of companionship and society are “inherently somewhat imprecise.” Uzoka, 290 S.W.3d at 454 . Because these damages are unliquidated and incapable of precise mathematical calculation, once the existence of non-economic loss is established, the jury is given significant discretion in fixing the amount of the award. Id. We take that into account when we conduct a meaningful review of the quantum of any such award. Saenz v. Fid. & Guar. Ins. Underwriters, 925 S.W.2d 607 , 614 (Tex. 1996). Juries must find an amount that would fairly and reasonably compensate for the plaintiffs’ loss. Damages at Issue In wrongful death cases, mental anguish damages and loss of companionship and society damages both compensate for non-economic losses. Lillebo, 722 S.W.2d at 687. Mental anguish is concerned not with the benefits the claimants have lost, but with the direct emotional suffering experienced as a result of the death. Id. at 688. Compensation for mental anguish can be awarded only for such anguish that causes “substantial disruption in daily routine” or “a high degree of mental pain and distress.” Parkway Co. v. Woodruff, 901 S.W.2d 434 , 444 (Tex. 1995). However, in wrongful death cases, proof of mental anguish does not require evidence of physical symptoms such as sleeplessness, weight loss, nervousness, personality changes, and the like. Lillebo, 772 S.W.2d at 686–87. Proof of the familial –45– relationship alone “constitutes some evidence” of the mental anguish a surviving family member experiences when another member dies. Id. at 686. While mental anguish focuses on the negative impact the wrongful death had on the beneficiaries, a claim for loss of companionship and society asks “what positive benefits have been taken away from the beneficiaries by reason of the wrongful death?” Id. at 688. Damages for loss of companionship and society are intended to compensate the beneficiary for the positive benefits flowing from the love, comfort, companionship, and society that the beneficiary would have received had the decedent lived. Id. at 687–88. In awarding damages for mental anguish and loss of companionship in a wrongful death case, the jury may consider (1) the relationship between husband and wife or a parent and child; (2) the living arrangements of the parties; (3) any absence of the deceased from the beneficiary for extended periods; (4) the harmony of family relations; and (5) common interests and activities. Id. at 688. The jury charge in this case properly instructed the jury on these factors. Trial Testimony Relevant to the Awards The evidence presented at trial established Deol was 45 years old at the time of his death and his life expectancy was 78.4 years. Accordingly, had Deol survived the accident, he was expected to live another 33 years. Deol’s wife, Jaswinder, testified regarding the effect of Deol’s death on her and her family members and –46– about the positive influences Deol had on them.16 See Woodruff, 901 S.W.2d at 444 (mental anguish evidence can come from testimony of third parties). Counsel’s questioning of Jaswinder spans over fifty pages of the reporter’s record. Jaswinder testified that she and Deol first met in India when she was 16 or 17 years old. Deol courted her for a year before she would speak to him and they began dating. Eventually, Jaswinder’s family moved to Canada and Deol’s family moved to the United States. Jaswinder’s parents wanted an arranged marriage for her with someone else, but she and Deol loved each other and fought for their relationship. She stated that, throughout her and Deol’s struggle for acceptance with her family, she knew they were meant to be. Jaswinder and Deol had three children together, and she described their family as very close. They enjoyed many activities and traveling together. Jaswinder worked part-time, and Deol was the primary financial provider for their extended family that included Deol’s parents, who lived with them. Deol “did everything” for the family. He loved cooking and working in the garden, and he would help out around the house. Jaswinder and Deol were “very, very close.” He was “everything” to her and was her “best friend.” Even when he was on the road working, Jaswinder would call and consult with him about “every single thing.” Even now, when she’s 16 Jaswinder testified the children were at home in Bakersfield, California with their grandparents. She explained she did not bring the children to court because she did not want them to hear about the accident. She stated it was hard for her to be there. –47– stressed, she finds herself talking to Deol. Deol had been excited to experience their children’s milestones, and she misses Deol every time her children do something memorable, like when G.D. crawled for the first time. She stated she “misses everything” about her husband. The night of the accident Jaswinder tried calling Deol a “hundred times.” She was concerned because he always answered her calls on the first ring. The following evening, Jaswinder arrived home from work to find the house full of relatives. The police had earlier informed Deol’s father that Deol had been killed, but the family did not want to tell Jaswinder because they were afraid she would become hysterical in front of the children. When Jaswinder learned the police had come by, she became worried. She began calling hospitals in Texas looking for Deol. Eventually she found a business card with the phone number for the local police, and she called and left a message. Shortly thereafter, someone returned her call and told her that Deol had been killed. She described that moment as “the saddest moment of her life.” She has no memory of what happened next, and she doesn’t remember how her children learned their father was dead. At the funeral she “was out of [her] mind.” She stated she could not recall the funeral or how she got there. Consistent with tradition, Jaswinder and the family traveled to India to spread Deol’s ashes in a river. Although it is also tradition to pass out the deceased’s clothing to the poor, Jaswinder could not bring herself to part with Deol’s –48– belongings, and she bought new clothes for the poor instead. Jaswinder stated she saved all of Deol’s belongings, including his electric razor that still has his hair in it. Since Deol supported the family, they could not afford to keep their house after his death. Jaswinder was forced to relocate the family from Maryland to California so that she could work for Deol’s brother. She stated they can no longer pay for the things they used to enjoy. Jaswinder began taking anti-depressant medication, which she was still taking at the time of trial. She described Deol as “the love of her life,” and she misses him “every single moment.” She said the home environment is “very sad” and Deol’s death “destroyed” her family. They no longer celebrate birthdays and she sometimes misses parent-teacher conferences because they are too difficult without Deol. When the children learned of Deol’s passing, H.D., the oldest, sat with Jaswinder and held her. A.D. went to his room and would not talk to anyone. H.D. and A.D. were very attached to Deol, whom Jaswinder described as a loving father. Before Deol’s death, H.D. was happy. Now he is in pain and very quiet. He does not talk much and stays to himself. Jaswinder stated he no longer has a role model. H.D. was given two tickets to his middle school graduation. He brought one ticket home telling Jaswinder “we do not need two.” He then went to his room and cried. Deol and H.D. used to play video games, ride bikes, and play basketball. Deol used to put H.D. and A.D. to bed, and he would stay with them until they fell asleep. –49–  Since Deol’s death, A.D. has gained a lot of weight. He was more active before Deol’s death because he and Deol often did things together. Now A.D. just sits with Jaswinder and reads. He seems depressed most days and frequently talks about his dad. A.D. was in a gifted program in Maryland, but after they moved to California, advanced classes were no longer an option because of the expenses involved. Jaswinder stated they also do not travel anymore because she does not like to drive on the highway and they do not have enough money. Both boys continue to cry out for their father. G.D. was seven months old when Deol died. Deol loved G.D. deeply, and when she was born he would not allow other family members to hold her. Jaswinder testified that G.D. notices other children have fathers and she asks frequently about hers. G.D. sees pictures of Deol in the house and asks when he’s coming home, and whether they are going to go pick him up from the airport. Jaswinder stated she can’t bring herself to face G.D. when she asks about her dad and, when G.D. notices that her questions make Jaswinder sad, she will stop asking. According to Jaswinder, G.D. recognizes the family is struggling financially and when she sees things in the store that she wants, she will say it is too expensive, even when Jaswinder is willing to buy it for her. At the time of Deol’s death, Deol’s mother, Jagtar, was 71 years old and his father, Darshan, was 75. Deol and Jagtar were very close. They used to cook and garden together. Since Deol’s death, she cries multiple times every day. Darshan –50– learned of his son’s death from the police officer who visited the house. He arranged to have his son’s body transported back to Maryland for the funeral, and he traveled with Jaswinder to India to spread his son’s ashes. While Darshan does not cry in front of Jaswinder, she explained that since Deol’s death, the entire family’s living environment is sad and everything has changed. Jury Instructions The jury instructions defined loss of companionship and society to mean “the loss of the positive benefits flowing from the love, comfort, companionship, and society that [each Deol family member], in reasonable probability, would have received from Bhupinder Singh Deol had he lived.” The instructions also defined mental anguish as “the emotional pain, torment, and suffering experienced by [each Deol family member] because of the death of Bhupinder Singh Deol.” The trial court further instructed the jury that it could consider the relationship between Deol and each Deol family member, their living arrangements, any extended absences from one another, the harmony of their family relations, and their common interests and activities. See Lillebo, 722 S.W.2d at 688 (describing these elements for jury’s consideration in wrongful death cases). The trial court also instructed the jury not to include damages for one element in the others. Under Golden Eagle Archery, we must presume that the jury followed these instructions and did not award damages for one element more than once unless the record shows otherwise. 116 S.W.3d at 771. Thus, in determining the damages, the –51– jury charge permitted the jury to make its own determination of how to categorize and compensate the Deol family based on the evidence presented about the damages caused to the family because of Deol’s death. Id. at 770. Jaswinder The jury awarded Jaswinder $350,000 in loss of past companionship, $2,625,000 in loss of future companionship, $525,000 in past mental anguish, and $3,937,500 in future mental anguish, for a total of $7,437,500 in non-economic damages. Appellants do not specify which of these awards they believe to be excessive, nor do they specify in what respect the evidence is lacking to support these different awards. Appellants did not subject Jaswinder to cross-examination, nor did they address any of the plaintiffs’ damages in their closing argument. Appellants’ motion for judgment notwithstanding the verdict simply alleged there was “no evidence” to support each category of damages for each plaintiff. The evidence presented established Jaswinder had a long and loving relationship with Deol, and she was dependent on him both financially and emotionally. From the evidence presented, the jury could have found Jaswinder and Deol had an extremely harmonious relationship and shared the love of their family and the nurturing and education of their children. In addition, the evidence supports a finding that Jaswinder has suffered tremendous grief and depression since Deol’s death, and that her grief had not waned over the years. Gregory and New Prime concede that the way Jaswinder learned of her husband’s demise was tragic. Her –52– testimony established she was left to wonder for over a day where he was and what had happened to him and that she was devastated when she learned of Deol’s death. The evidence showed Deol’s death significantly and permanently changed Jaswinder’s life. She no longer has Deol to provide emotional and financial support. The jury could have reasonably concluded Jaswinder and Deol had a very special, symbiotic relationship, the loss of which is likely to leave long-lasting emotional devastation. See, e.g., Transco Leasing Corp. v. United States, 896 F.2d 1435 , 1453 (5th Cir.), amended on other grounds on rehearing, 905 F.2d 61 (5th Cir. 1990). Accordingly, we conclude the evidence supporting Jaswinder’s mental anguish and loss of companionship damages more than satisfies the Lillebo factors for reviewing awards for excessiveness. Jaswinder’s testimony was thorough, detailed, non- conclusory, and compelling, and the jury’s awards were not so contrary to the overwhelming weight of the evidence that the verdicts were clearly wrong and unjust. Deol’s Children17 A.D. was 8 years old and H.D. was 10 years old when Deol died. According to the trial record, Deol was very close to both his sons. Both boys have demonstrated significant and continuing grief over Deol’s death. The boys no longer 17 It is unclear which non-economic damage awards appellants challenge, but in their opening brief appellants complain that there was no evidence revealing “true mental anguish” for Deol’s children. In their supplemental briefing, appellants complain that the lost companionship awards for Deol’s children were identical and the jury gave the same amount for their mental anguish damages. –53– enjoy their father’s guidance and companionship, and they cannot afford to do the things they used to do. From the evidence presented, the jury could have reasonably concluded Deol’s death had a profound and lasting impact on H.D. and A.D. Again, the evidence developed at trial supports the Lillebo factors, and the jury’s awards to H.D. and A.D. of $160,000 for loss of past companionship, $160,000 for past mental anguish, $925,000 for future mental anguish, and $1,200,000 for loss of future companionship were not so contrary to the overwhelming weight of the evidence as to be clearly wrong and unjust. With respect to G.D., while she was situated differently than her brothers because she was an infant at the time of Deol’s death, there was evidence that she has experienced mental anguish and loss of companionship due to the loss of her father. Jaswinder testified Deol was extremely protective of G.D. from the time she was born. The jury could infer from this that G.D. bonded with Deol and he provided a sense of security that was no longer present after he died. Along with the evidence that G.D. was aware of, and troubled by, the absence of her father, the jury was free to consider the emotional turmoil and other disruption that Deol’s death caused in the home. While the evidence concerning G.D.’s mental anguish was not as fully developed as it was for her brothers, the jury’s award of only $97,500 in past and future mental anguish accounted for this. As to loss of companionship and society, the record established Deol was a loving father and provided financial and emotional support to his family and –54– promoted the education of his children. While G.D. was young at the time of Deol’s death, the jury could have reasonably concluded her loss of the companionship and society of Deol was no less than that of her brothers. Accordingly, we conclude the jury’s award of $1,360,000 to G.D. for past and future loss of companionship and support is not clearly wrong or manifestly unjust. Deol’s Parents The evidence established Deol’s parents lived with Deol and his family. Four years after Deol’s death, his mother still cries every day. Given the manner in which Deol died, the closeness between Deol and Jagtar, and the severe emotional distress she exhibited, we conclude a reasonable jury could conclude she suffered significant mental anguish and a loss of companionship as a result of Deol’s death. While we acknowledge there was less testimony specific to Deol’s father, the jury was free to consider the general testimony about how the whole family was living together in one house and that the household as a whole was “destroyed” by Deol’s death. In addition, the jury heard how Darshan was the first to learn of his son’s death from the police officer who visited the house and how he felt he had to keep this information from Jaswinder. It was Darshan who arranged to have his son’s body transported back to Maryland, and he made the long trip with Jaswinder to India for the solemn purpose of spreading Deol’s ashes. Because Deol was the family’s primary caretaker, the entire family was forced to move cross-country so that Jaswinder could find full-time work. Finally, Darshan has had to watch his wife –55– cry multiple times a day, every day, since their son was killed. The fact that Deol’s father may not have expressed his grief in the same manner as the other members of his family, did not preclude the jury from finding he has suffered, and will continue to suffer, equally. It is uniquely the province of the jury to quantify matters of non-economic damages. See United Rentals N. Am., Inc. v. Evans, No. 05-18-00665-CV, 2020 WL 4783190 , at *12 (Tex. App.—Dallas Aug. 18, 2020, pet. filed). “As long as there is sufficient probative evidence to support the jury’s verdict, this Court will not substitute its judgment for that of the jury.” Id. In the absence of a showing that passion, prejudice, or other improper motive influenced the jury, the amount assessed by it will not be set aside as excessive. Id. A large award, in and of itself, does not show that the jury was influenced by passion, prejudice, sympathy, or other circumstances not in evidence. Id. For us to reverse an award, it must be flagrantly outrageous, extravagant, and so excessive that it shocks the judicial conscience. None of the awards at issue here meet this criteria. We conclude the evidence supports the amounts awarded to each member of the Deol family. IX. Cumulative Error In their final issue, Gregory and New Prime contend the cumulative effects of the matters they assert as the trial court’s errors in this case requires reversal and remand for a new trial. Texas courts recognize the doctrine of cumulative error, wherein a reviewing court may reverse a lower-court judgment when the record –56– shows a number of instances of error, “no one instance being sufficient to call for a reversal, yet all the instances taken together may do so.” Sproles Motor Freight Lines, Inc. v. Long, 168 S.W.2d 642 , 645 (Tex. 1943). To support reversal based on cumulative error, a complaining party must show that “based on the record as a whole, but for the alleged errors, the jury would have rendered a verdict favorable to it.” Owens-Corning Fiberglas Corp. v. Malone, 916 S.W.2d 551 , 570 (Tex. App.—Houston [1st Dist.] 1996), aff’d, 972 S.W.2d 35 (Tex. 1998). Here, Gregory and New Prime contend that the combination of the trial court’s striking responsible third parties, failing to submit a charge instruction on unavoidable accident, and submitting improper broad form jury questions on negligent entrustment, negligent training, and negligent supervision, probably caused the rendition of an improper verdict. As discussed above, we have concluded there is no error in regard to Gregory and New Prime’s complaints. When there are no errors to be considered as a combined whole for purposes of evaluating harm, we reject cumulative error arguments. In re BCH Dev., LLC, 525 S.W.3d 920 , 930 (Tex. App.—Dallas 2017, orig. proceeding) (citing Caro v. Sharp, No. 03-03-00108-CV, 2003 WL 21354602 , at *8 (Tex. App.—Austin June 12, 2003, pet. denied) (mem. op.)). –57–  CONCLUSION We overrule Gregory and New Prime’s first through tenth and twelfth through thirteenth issues. We affirm the trial court’s judgment. /Amanda L. Reichek/ AMANDA L. REICHEK JUSTICE Whitehill, J., concurring in part and dissenting in part, joined by Richter, J. Schenck, J., concurring in part and dissenting in part, joined by Browning, J. and Richter, J. 180167F.P05 –58–  S Court of Appeals Fifth District of Texas at Dallas JUDGMENT SARAH GREGORY AND NEW On Appeal from the County Court at PRIME, INC., Appellants Law No. 5, Dallas County, Texas Trial Court Cause No. CC-15-02925- No. 05-18-00167-CV V. E. Opinion delivered by Justice JASWINDER CHOHAN, Reichek. Court sitting en banc. INDIVIDUALLY AND AS NEXT FRIEND AND NATURAL MOTHER OF G.K.D., H.S.D., AND A.D., MINORS, AND AS REPRESENTATIVE OF THE ESTATE OF BHUPINDER SINGH DEOL, DARSHAN SINGH DEOL, AND JAGTAR KAUR DEOL, GUILLERMO VASQUEZ, WILLIAM VASQUEZ, INDIVIDUALLY AND AS ADMINISTRATOR OF THE ESTATE OF ALMA B. (“BELINDA”) VASQUEZ, ALMA J. PERALES, INDIVIDUALLY AND AS ADMINISTRATOR OF THE ESTATE OF HECTOR PERALES AND AS NEXT FRIEND OF MINOR N.P., Appellees In accordance with this Court’s opinion of this date, the judgment of the trial court is AFFIRMED. –59– It is ORDERED that appellees JASWINDER CHOHAN, INDIVIDUALLY AND AS NEXT FRIEND AND NATURAL MOTHER OF G.K.D., H.S.D., AND A.D., MINORS, AND AS REPRESENTATIVE OF THE ESTATE OF BHUPINDER SINGH DEOL, DARSHAN SINGH DEOL, AND JAGTAR KAUR DEOL recover their costs of this appeal and the full amount of the trial court’s judgment from appellants SARAH GREGORY AND NEW PRIME, INC. and from Atlantic Specialty Insurance Company as surety on appellants, supersedeas bond. Judgment entered November 30, 2020 –60–

2021-03-18 21:02:07.352141+00

https://ecf.cofc.uscourts.gov/cgi-bin/show_public_doc?2020cv1230-54-0

In the United States Court of Federal Claims No. 20-1230C Filed: February 7, 2021 Redacted Version Issued for Publication: March 18, 20211 * * * * * * * * * * * * * * * * * ** * * MORTGAGE CONTRACTING * SERVICES, LLC, * * Protestor * * v. * THE UNITED STATES, * * Defendant, * * v. * * * INFORMATION SYSTEMS & * NETWORKS CORPORATION, * Defendant-intervenor. * * * * * * * * * * * * * * * * * * * ** * Greg S. Jacobs, Polsinelli, PC, Washington, DC for protestor. With him was Erin Felix, Polsinelli, PC. Ashley Akers, Department of Justice, Washington, DC, Trial Attorney, Commercial Litigation Branch, Civil Division, Department of Justice, Washington, DC, for defendant. With her were Robert E. Kirschman, Jr., Director, Commercial Litigation Branch, and Brian Boynton, Acting Assistant Attorney General, Civil Division. Matthew T. Schoonover, Schoonover & Moriarty LLC, Olathe, KS for intervenor. 1 This Opinion was issued under seal on February 7, 2021. The parties were asked to propose redactions prior to public release of the Opinion. This Opinion is issued with the redactions that the parties proposed in response to the court’s request and other conforming redactions. Words which are redacted are reflected with the notation: “[redacted].”  OPINION HORN, J. In the above-captioned post-award bid protest, protestor Mortgage Contracting Services, LLC (MCS) challenges the decision of the United States Department of Agriculture (USDA) to award a contract to intervenor, Information System and Networks Corporation (ISN), arguing that the award was “arbitrary and capricious” and should be reversed. This Opinion memorializes the oral decision issued by the court which granted protestor’s motion for injunctive relief, effective immediately at the time of the oral decision. FINDINGS OF FACT The solicitation at issue in the above captioned protest, Solicitation No. 12SAD119R0003 (the Solicitation), explained that the National Account and Financial Operations Center (NFAOC) is a unit within the USDA’s Rural Division (RD) and is charged with servicing mortgage loans and grants extended to individuals in rural areas throughout the United States, Puerto Rico, American Samoa, the U.S. Virgin Islands, and the Pacific Trust Territories. Beginning operation in October 1996, NFAOC has serviced as many as 650,000 government loans and grants originating with U.S. Treasury funds. NFAOC’s mission is to be a cost effective service provider that strives to keep individuals and families in their homes through the use of various servicing tools including payment subsidies, moratoriums on payments, partial payment agreements and other methods. Low and very low income families are provided this subsidized loan program through a network of field offices across the United States of America (USA), its territories, and commonwealths. (capitalization in original). The Solicitation continued: The USDA, RD, NFAOC provides exceptional servicing to 258,020 Single Family Homes (SFH) Direct Loans (DL) made or insured by the Rural Housing Service (RHS). Currently the loans are valued at over $14 billion in unpaid principal balance. Under the DL program, individuals and families receive direct financial assistance from the RD Housing Programs in the form of home loans to eligible low, and very low-income households, at affordable interest rates to achieve homeownership. The agency is committed to providing an opportunity for rural Americans to become and remain successful homeowners. (capitalization in original). 2  On April 27, 2019, the USDA issued the Solicitation for property preservation and inspection services for its rural property portfolio. The Solicitation contemplated a single award, indefinite-delivery, indefinite quantity contract to the offeror evaluated as the best- value offeror. The indefinite-delivery, indefinite quantity contract was to be for a total of 18-months, and contemplated the work to be issued under two task orders: Task Order 1 was to be issued for the first 12 months, and was to be issued at the time of award of the total contract, and Task Order 2 was to be issued for the remaining six months. Under the heading: “Relative Importance of Factors” the Solicitation stated: The award resulting from this solicitation will be made based on the best overall proposal that is determined to be the most beneficial to the Government (i.e., best value tradeoff process). The Technical Capability Factor is slightly more important than the Past Performance Factor. Technical Capability Subfactors, 1.1, 1.2, 1.3, 1.4 and 1.5, are rated in descending order of importance. Overall, Non-Price Factors, when combined, are significantly more important than Price. Price is not an adjectivally rated Factor; however, the Price Factor will become the more dominant factor as technical proposals reach technical equality. In such cases, where all non-priced factors being evaluated are virtually the same, best value may be represented by the lowest-priced proposal. For each proposal received, the Government will evaluate the following factors: Factor 1: Technical Capability (overall capabilities to encompass subfactors belows [sic]: Subfactor 1.1 Relevant Experience Subfactor 1.2 Nationwide Coverage, Geographic Service Area Subfactor 1.3 Management Approach, to include QASP [Quality Assurance Surveillance Plan] Subfactor 1.4 Staffing Plan, Key Personnel Resumes, Subcontractors; Subcontracting Plan Subfactor 1.5 Property Management System Factor 2: Past Performance Factor 3: Price Contents of the written proposals will be evaluated to determine the degree and extent to which the requirements set forth in the RFP are satisfied. If a proposal is determined to be incomplete or fails to fully meet any material requirement of the RFP, that may render a proposal unacceptable and, thus, ineligible for award. In accordance with 52.215-1(f)(4), it is the Government’s intent to award without discussion; therefore, it is incumbent upon all offers to submit their best proposal. Award may not necessarily be made to the lowest price(s) 3  offered. As such, offerors are encouraged to submit their best proposal upon initial submission. (capitalization and emphasis in original). The work to be performed under the contract was broken down into six separate contract line items (CLINs): (1) “CLIN 0001: Property Inspections (REO [Real Estate Owned] and Foreclosure Custodial Properties);” (2) “CLIN 0002: Property Preservation (REO and Foreclosure Custodial Properties);” (3) “CLIN 003: Reports, NSP [Not Separately Priced];” (4) “CLIN 004: Contingency Preservation, Pass Through Expenses (Cost Reimbursable IAW Price List);” (5) “CLIN 005: Other Direct Costs – Travel, NTE [Not to Exceed];” and (6) “CLIN 006: TRANSITION-IN/OUT.” (all capitalization original). As reflected below, only CLIN 0001 (CLIN 1) and CLIN 0002 (CLIN 2) were priced.2 For the Technical Factor, the Solicitation stated: FACTOR 1 – Technical Capability – Overall the Technical Capability will be evaluated based on the extent to which it is demonstrated a likelihood of successful performance of the requirements of the Performance Work Statement (PWS) (Attachment A). The effectiveness and feasibility of the proposed Technical Capability and the offerors understanding of the work will be considered as part of the assessing the likelihood of successful performance. (capitalization and emphasis in original). The Solicitation explained: There are five technical capability subfactors that will be evaluated and considered in descending order of importance as follows and evaluated based on: Sub-factor 1.1 - Relevant Experience - Demonstration of experience in providing services to assist USDA, RD in providing a variety of property/asset management services associated with pre and post liquidation of SFH rural properties serving as security for rural housing loans and guarantees of equivalent portfolio size, as specifically listed in the PWS. Sub-factor 1.2 – Nationwide Coverage – Geographical Service Area Demonstration of the capacity to provide a nationwide “Heatmap” of available personnel for property preservation services (vendors/subcontractors); displaying the ability, currently or in the future, to provide services to all 50 United States and the territories of Puerto Rico, the Virgin the Western Pacific U.S. Territories. To confirm this ability required, the Offeror must submit a service Heatmap, as discuss in the PWS [Performance Work Statement] (also see Heatmap Information, Attachment C1) that reflects coverage of all the states, counties, and territories, and 2The court notes the numbering of the CLINs was inconsistent. For example, CLIN 1 was sometimes labeled as CLIN 0001 and other times labeled as CLIN 001 or CLIN 1. 4  must also include a plan with tentative timelines to provide 100% coverage for all USDA services areas. Sub-factor 1.3 – Management Approach - Demonstration that the offeror can provide all management, supervision, labor, tools, supplies, insurance, taxes, fees, permits to complete the services, including all reporting and documentation as explicitly set forth in the PWS. A demonstration of how offeror will manage RD’s large nationwide portfolio and an and all quality assurance implementation. A QASP must be submitted with this plan (see QASP Template Attachment C2). Sub-factor 1. 4 – Staffing Plan - Demonstration that current staff available along with planned staffing levels to meet the technical requirements and schedules identified in the PWS. Demonstration of ability to onboard and ramp-up staffing in a given service area. Demonstration of staffing (or a network of subcontractors (available to handle hazardous materials remediation (Meth/LB Paint/Mold). To minimally satisfy this sub-factor the submission must identify staff to be used to satisfy the scope of this requirement to include both prime and subcontracting staffs. Staffing levels that are deemed as unrealistic to satisfy the requirement scope will receive an “Unacceptable” rating. The Offeror is required to include resumes for key personnel positions and emergency points of contacts. Offeror’s subcontracting plan must be discussed in this section, and the subcontracting plan (see C5, Subcontracting Plan Template included with information submitted with Volume 4, Other Documents). Sub-factor 1.5 Property Management System – Demonstration that Offeror has a system that is able to identify real time status (ordering and tracking) of each RD property, and demonstrate the capability to timely exchange data with other clients’ loan servicing systems (i.e, USDA utilizes LoanServ); and must demonstrate that USDA personnel will have access to request work orders review documentation, and approve/reject items, etc. (capitalization and emphasis in original). The Solicitation provided that the technical aspect of each proposal would be evaluated using a “Combined Technical/Risk Rating,” which included “consideration of risk in conjunction with the strengths, weaknesses, uncertainties, and deficiencies in determining technical ratings.” The Solicitation provided the following table on which the offerors’ technical capabilities would be evaluated: 5 The Solicitation defined the terms strength, weakness, deficiency, and risk as: Strength - any aspect of a proposal when judged against a stated evaluation criterion enhances the merit of the proposal or increases the probability of successful performance of the contract. A significant strength appreciably enhances the merit of a proposal or appreciably increases the probability of successful contract performance. Weakness - A flaw in the proposal that increases the risk of unsuccessful contract performance. A significant weakness in a proposal is a flaw that appreciably increases the risk of unsuccessful contract performance. Deficiency -material failure of a proposal to meet a Government requirement or a combination of significant weaknesses in a proposal that increases the risk of unsuccessful contract performance to an unacceptable level. Risk – Assessment of risk considers potential for disruption of schedule, increased costs, degradation of performance, the need for increased Government oversight, or the likelihood of unsuccessful contract performance. Factor ratings can be adjusted based on a risk consideration. (capitalization and emphasis in original). For the Past Performance Factor, the Solicitation stated: FACTOR 2 – Past Performance The past performance confidence assessment rating is based on the offeror’s overall record of recency, relevancy, and quality of performance. In addition, for large business concerns, the Government will evaluate past 6  performance to determine the extent to which offeror has attained applicable goals for small business participation under prior contracts that required subcontracting plans. Relevant experience must be demonstrated within the last three years of providing property preservation and inspection services as required in the PWS. Specifically, a review of record of quality of service, personnel, adhering to contract schedule and cost contract, and attainment of subcontracting goals, if applicable. In accordance with FAR 15.305(a)(2), the currency and relevance of the information, source of the information, context of the data, and general trends in contractor’s performance shall be considered. These are combined to establish one performance confidence assessment rating for each offeror. In addition, this assessment of offeror’s performance will contribute to the responsibility determination. (capitalization and emphasis in original). Regarding the Past Performance Factor, each proposal was to be evaluated under the following method: Regarding the Price Factor, the Solicitation stated: The base IDIQ 18-month effort as well as Task Order 1, CLINs 001 and 002, will be evaluated for price reasonableness, realism and balance, as 7 further described below. The total pricing, including the NTE [Not to Exceed] plug-in CLINs 004, 005, and 006 will be totaled to come up with the total IDIQ ceiling price. CLINS 003 Reports is Not Separately Priced (NSP) and thus not be [sic] evaluated. CLINs 004, 005 and 006 also will not be evaluated. The amounts for these CLINs are estimated plug-in amounts, as shown in C4 Pricing Worksheets. As noted above, the plug-in amounts will be included in the ceiling total from CLIN 001 and 002 for the total IDIQ ceiling price; and for Task Order 1, the total task order price. . . . 7.1 Proposal Analysis The Contracting Officer is responsible for evaluating price/cost proposals using the methods of price and cost analysis in accordance with the Federal Acquisition Regulations. The CO will use the processes of price and realism analysis, and review service prices for balance in pricing as discussed below. 7.2 Price Analysis Price analysis is a process of examining and analyzing a proposed price without evaluating separate cost elements and proposed profit/fee to ensure that the proposed price is fair and reasonable. The CO may use the following techniques in performing price analysis: (a) Comparison of proposed prices received in response to the Solicitation; (b) Comparison of previously proposed prices and contract prices with current proposed prices for the same or similar services (labor categories) in comparable quantities; and, (c) Comparison of proposed prices with independent cost estimates. 7.3 Realism Analysis The purpose of realism analysis is to ensure that proposed prices are not so low such that contract performance is put at risk from either a technical and/or cost perspective. It is separate from analyses performed to determine price reasonableness. Realism analysis determines whether an offeror’s proposed costs and/or prices: (a) Are realistic for the work to be performed; (b) Reflect a clear understanding of the requirements; and (c) Are consistent with the various elements of the offeror's technical proposal. 8  Price Realism analysis is an objective process that focuses on the proposed price and performance risks. Price realism is used when requirements may not be fully understood by the offeror, there are quality concerns, past experience indicates that contractors’ proposed prices have resulted in quality of service shortfalls. Results of the analysis may be used in performance risk assessments and responsibility determinations. (capitalization and emphasis in original). Under section 8, the Solicitation explained the basis for the award: The award will be made based on the best overall (i.e., best value tradeoff process) proposal that is determined to be the most beneficial to the Government, with appropriate consideration given to three (3) evaluation factors on a trade-off basis: (1) Technical Capability, (2) Past Performance and (3) Price. All proposals shall be subject to evaluation by a Technical Evaluation Team (TET). Proposals will be evaluated according to the evaluation criteria stated above. In conducting its evaluation, the Government intends to determine which offer proposes the best value. Accordingly the Government may award any resulting contract to other than the offer proposing the lowest price or other than the offer achieving the highest rating. To receive consideration for award, a rating of no less than “Acceptable” must be achieved for the Technical Capability Factor. The Government is more concerned with obtaining superior technical features than with making an award at the lowest overall cost to the Government. However, the Government will not make an award at a significantly higher overall cost to the Government to achieve slightly superior technical or management features. No proposal shall be considered for award that fails to reflect the offeror’s clear intent to provide the full amount of work described in this solicitation. In addition, USDA intends to award a contract without discussions with offerors but reserves the right to conduct discussions and/or negotiations with any and/or all offerors, as determined by the Contracting Officer to be necessary. (capitalization and emphasis in original). In response to the Solicitation, 11 offerors submitted proposals, including protester MCS and intervenor ISN, each of which submitted their proposals on May 28, 2019. MCS’ initially offered price was $[redacted] for Task Order 1 (12 months), and $57,183,879.00 for the total IDIQ contract (18 months). According to the protestor’s complaint, however, “[f]ollowing discussion questions received from USDA on August 29, 2019, MCS submitted an updated price proposal on September 4, 2019. In its updated proposal, MCS’ proposed prices were reduced to $[redacted] for Task Order 1 and $[redacted] for the 18-month IDIQ.” After discussions, ISN’s final price proposals was $[redacted] for 9 Task Order 1 and $38,213,017.00 for the total ceiling price. After the updated proposals were received, the agency reached out to the ISN on January 2, 2020 with a request for clarification on two issues. First, to confirm that ISN understood “that 100% of the properties requiring Property Preservation Services will be located in Rural America?” to which ISN responded “yes,” and second, to confirm that ISN fully understood “all of the PWS requirements for each of the service line items in which you submitted pricing for?” to which ISN responded “yes.” Regarding the technical capabilities and past performance factors of the offerors’ proposals, the Technical Evaluation Team (TET) for the USDA RD documented its findings of the offerors’ proposals in a Consensus Narrative Report, dated January 21, 2020. The TET ranked each of the 11 offerors’ proposals for the Technical Capability Factor and Past Performance Factor as follows: As indicated in the above table, protestor MCS and intervenor ISN submitted the only proposals to achieve both an “Outstanding” rating for the Technical Capability Factor, and a “Substantial Confidence” rating for the Past Performance Factor. Specifically, according to the TET, MCS submitted the best proposal for non-price factors, and the TET summarized its ratings as: 10  OFFEROR: MORTGAGE CONTRACTING SERVICES (MCS) CONSENSUS RATING Factor 1: Technical Capability & Subfactors OUTSTANDING Subfactor 1 Relevant Experience Outstanding Subfactor 2: Nationwide Coverage - Geographical Service Area Outstanding Subfactor 3: Management Approach, w/QASP Outstanding Subfactor 4: Staffing, and Key Personnel Resumes Outstanding Subfactor 5: Property Management System Outstanding Factor 2: Past Performance Confidence Rating Substantial Confidence* The TET ranked ISN was the second best proposal for non-price factors, and its ratings were summarized as: OFFEROR: Information Systems & Networks Corporation (ISN) CONSENSUS RATING Factor 1: Technical Capability & Subfactors OUTSTANDING Subfactor 1 Relevant Experience Outstanding Subfactor 2: Nationwide Coverage - Geographical Service Area Outstanding Subfactor 3: Management Approach, w/QASP Outstanding Subfactor 4: Staffing, and Key Personnel Resumes Outstanding Subfactor 5: Property Management System Outstanding Factor 2: Past Performance Confidence Rating Substantial Confidence After evaluation, the agency selected ISN for award and the contracting officer Shelia Stoddard informed ISN that it had been selected for award on January 31, 2020. Subsequently, on February 5, 2020, Ms. Stoddard informed MCS that it had not been selected for award; and on February 11, 2020, the USDA RD issued a debriefing letter to MCS. With regard to MCS’ price, the debriefing letter stated: CLIN 001 Inspections - Pricing is comparable to the Competition Price Results (CPR) and comparable to CLIN 001 pricing for other competitive proposals. Therefore CLIN 001 is found fair and reasonable. However, for CLIN 002 Property Preservation Services, the individual service items on the price list are higher, especially in the case of [redacted], which are in most instances [redacted]% over the CPR and on the higher side of the competitive prices offered by the other offerors. Offeror as the incumbent, indicated their pricing is based on their respective cost experience, their technical approach and the nature of the work for rural America. Therefore, MCS’s price is found realistic and in conformity for their proposed technical approach. 11  Summarily, CLIN 001 and 002 combined are higher than CPR (compared to other competitive prices) received with a technical rating of acceptable and above. In accordance with evaluation criteria set forth in Section M paragraph 4., “the Price Factor will become the more dominant factor as technical proposals reach technical equality. In such cases, where all non- priced factors being evaluated are virtually the same, best value may be represented by the lowest-priced proposal.” Therefore, notwithstanding, MCS’ price finding to be competitive in price, they are not determined to be the best value to the Government in accordance with the evaluation criteria. On February 18, 2020, MCS filed a protest of the award to ISN with the United States Government Accountability Office (GAO). In MCS’ protest, MCS alleged that USDA made numerous errors in its evaluation and award process under the Solicitation, resulting in its unreasonable and unsupportable determination to make award to ISN. First, ISN has an ‘unequal access to information’ organizational conflict of interest (“OCI”) stemming from its work as a support contractor to the U.S. Department of Housing and Urban Development (“HUD”), through which ISN receives extensive proprietary and confidential information regarding MCS and other property preservation and inspection field operators. The Agency unreasonably failed to disqualify ISN based on that OCI. In addition, USDA failed to recognize the unrealistic nature of ISN’s price proposal, which was apparently based on service pricing that would be appropriate for HUD’s urban property portfolio, but will create significant performance issues in the context of USDA’s rural properties. The Agency also unreasonably awarded ISN the highest possible ratings for Past Performance and Technical Capability. The information on ISN’s own website makes clear that, under the Solicitation’s stated evaluation criteria, ISN did not warrant the highest rating for either of those Factors. Finally, SDA incorrectly evaluated MCS’ original price proposal, and failed to account for the updated pricing that MCS provided on September 4, 2019. On February 19, 2020, the USDA issued a Stop Work Order to ISN, and in a February 28, 2020 letter to the GAO, counsel for the USDA RD responded to MCS’ protest at the GAO, stating: This letter is to notify GAO and the parties that the agency will take corrective action in the above-referenced bid protest. The agency has begun an investigation into the potential conflict of interest identified by the protester, the facts of which were unknown to the agency prior to the award. In addition, the agency identified errors in the evaluation process that could have affected the award decision. The agency will correct the errors and make a new and potentially different award decision, which will render moot the award decision now challenged by MCS. Accordingly, the agency requests that GAO dismiss the protest. 12 Thereafter, the GAO dismissed MCS’ protest and the USDA RD took corrective action. On March 23, 2020, the agency issued an OCI Memo for the Record which determined that the employees at ISN who worked on the HUD contract who were alleged to have provided unequal information “provided no input and were not a part of the proposed team for this effort” and “[t]he quoted pricing by ISN provided under this procurement appears to be in line with commercial pricing, and in line with the other commercial competitive pricing of offeror’s that were rated ‘acceptable’ in this competition.” The March 23, 2020 OCI Memo for the Record concluded with the “Contracting Officer’s Determination,” which stated: “After investigating this claim and reviewing the supporting information from ISN, I have determined the OCI alleged by MSN does not exist, and I have not identified any other OCI. As such, a conflict of interest does not preclude ISN from award/performance of a contract with Rural Development for Property Preservation Services.” In addition to the OCI Memo for the Record, as part of the corrective action the USDA re-evaluated the 11 proposals submitted in response to the Solicitation. On April 6, 2020, the agency issued a Proposal Analysis Report. Regarding the USDA evaluation of MCS’ proposal, the Proposal Analysis Report stated: 2.1 OFFEROR 1: MCS Consensus Rating: Outstanding 2.1.1 Offeror 1 – MCS - Key Technical Evaluation, Past Performance and Price Findings Summarily, MCS’s proposal received an Outstanding overall rating, that demonstrated a strong technical foundation, relevant experience, nationwide coverage reaches, management and staffing capabilities and a solid property management system that would exceed all performance expectations of requirements in the PWS. There were multiple “Strengths” in all the Subfactors. Subfactor 1.1 Experience: Strength(s) • Demonstrated extensive experience property preservation and inspection services, [redacted] Weaknesses: None Deficiency(ies) None Subfactor 2.2 Nationwide Coverage: Strength(s) • [redacted] that can do both property preservation and inspections; • ability to retain rural vendors with a [redacted] % turnover rate; • [redacted] Weaknesses: None Deficienc(ies) None 13 Subfactor 1.3 Management Approach/QASP: Strength(s) • Demonstrated a management approach [redacted], ensures effective, cost-efficient work performance. • Proven management processes ensure continued emphasis on customer-focused services [redacted]; • PM has [redacted] years of experience supporting the USDA-RD in all aspects of Property Preservation and Property Inspections program execution Weaknesses: None Deficienc(ies) None Subfactor 1.4 Staffing Plan, Key Personnel, Resumes Subcontractors; Subcontracting Plan Strength(s) • Demonstrated maintenance of a strong national vendor network of approximately [redacted] vendors that are experienced in all areas of property preservation and inspections and includes an inspections network consisting of [redacted] vendors as well as a network of over [redacted] vendors [redacted] • Dedicated [redacted] • Demonstrated a subcontracting plan, that provides [redacted]% small business subcontracting opportunities, exceeding the mandated of [redacted]%. • Demonstrated [redacted] Weaknesses: None Deficienc(ies) None Subfactor 1.5 Property Management System Strength(s): • Demonstrated [redacted] an enhanced feature in its PMS, that uses [redacted] that have helped to [redacted] in a cost-effective manner. • Demonstrated [redacted] – MCS has conducted [redacted] Weaknesses: None Deficienc(ies) None 2.1.2 PAST PERFORMANCE 2.1.2.1 Performance Confidence Assessment - Observations and Conclusions Past Performance was rated as Substantial Confidence, with findings indicating that as the incumbent contractor, MCS had an overall record of [redacted], and several other contracts relevant in size and scope. There were no [redacted] reported. There were two Past Performance 14  Questionnaires received for review, in which it indicated MCS exceeded and met performance standards (Ref. PPET Report, Contract File Index B20). 2.1.3 PRICE FACTOR 2.1.3.1 Summary of Proposed and Evaluated Cost/Price (MCS) – Task Order 1 Price Compared to Competition Price Results (CPR) Task Order 1 CLIN PROPOSED PRICE TO CLINs 1 & 2 CPR CLINs 1 & 2 Inspections CLIN 001 [redacted] [redacted] 3,395,537.00 Property Preservations CLIN 002 [redacted] [redacted] 23,054,219.00 Reports/NSP CLIN 003 [redacted] 0 Contingency PropPres CLIN 004 [redacted] ODC's-Travel CLIN 005 [redacted] Transition In/Out CLIN 006 [redacted] 0 TOTAL TO CEILING PRICE [redacted] COMPARISON CLIN TASK ORDER /CPR PRICE [redacted] $[redacted] COMPETITIVE PRICE CHART ISN [redacted] [redacted [redacted MCS [redacted] [redacted] CLIN 001 TOTAL IDIQ 18 $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] CLIN 001 TOTAL TASK $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] ORDER CLIN 002 TOTAL IDIQ 18 $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] CLIN 002 TOTAL TASK $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] ORDER BOTH CLINS TOTAL IDIQ $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] 18 BOTH CLINS TOTAL $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] TASK ORDER 12 MONTH CLIN 001 Inspections - Pricing is below the CPR, and comparable to CLIN 001 pricing for ISN, [redacted] and [redacted]. Therefore CLIN 001 is found fair and reasonable. CLIN 002 Property Preservation Services - The individual services items on the price list are higher, especially in the case of [redacted], which are in most instances [redacted]% TO [redacted]% over the CPR and on the higher side of the competitive prices offered by the offerors indicated in the competitive chart above, and found to be unreasonably high. Offeror as the incumbent, indicated their pricing is based on their respective cost experience, their technical approach and the nature of the work for rural America. 15  Summarily, CLIN 001 and 002 combined are higher than the CPR as shown in the table above and compared to other competitive prices received with a technical rating of acceptable or above. In accordance with evaluation criteria set forth in section M paragraph 4., “the Price Factor will become the more dominant factor as technical proposals reach technical equality. In such cases, where all non-priced factors being evaluated are virtually the same, best value may be represented by the lowest-priced proposal.” Therefore, even though MCS’s pricing is found to be realistic and in conformity for their proposed technical approach, their pricing is unreasonably high based on the comparative analysis performed for this solicitation. Therefore, MCS is not determined to be the best value in accordance with the evaluation criteria. MCS tied ISN in their technical rating with an “outstanding” but had an overall higher price. *Competition Price Results (Ref. B19 Price Proposal Evaluation-Price Competition Memo). (capitalization and emphasis in original). Regarding ISN’s proposal, the Proposal Analysis Report stated: 3.1 OFFEROR 2 – ISN Consensus Rating: Outstanding 3.1.1 Offeror 2 – ISN- Technical Evaluation, Past Performance and Price Findings ISN strongly demonstrated that they have the overall technical understanding and capabilities to successfully exceed the performance requirements of the solicitation’s PWS. ISN demonstrated experience in all phases of property preservation services with a leadership team with over 50 year of property preservation and inspection services experience; Nationwide coverage was comprehensively demonstrated; a management plan and QASP that were premised on their being a Capability Maturity Model Integration (CMMI) Level 3 company; a thorough staffing plan was provided; with a PMS that surpass the requirements of the PWS. ISN consensus ranking was “Outstanding” in all the Factor 1 Subfactors; and their Past Performance Confidence Assessment was “Satisfactory Confidence.” The multiple “Strengths” in Subfactors 1.1 to 1.5 “Strengths” are synopsized below Subfactor 1.1 Experience: Strength(s): • Robust Quality Control (QC) processes to review and confirm the quality and accuracy of inspection reports and photographs to determine necessary repairs and other work 16 • Subcontractor [redacted] experience to include their vendor network to cover all 50 states to include the needed territories • Demonstrated experience on other federal contracts (USMS and HUD) providing services in most rural and remote areas • Leadership team with over 50 years of PPIS experience • Demonstrated a detailed experience in all phases of property preservation services • Provided mitigation solutions for the challenges pertaining to property preservation in rural areas Weaknesses: None Deficienc(ies) None Subfactor 1.2 Nationwide Coverage: Strength(s): • Demonstrated strong nationwide coverage; with a network of [redacted] geographically disbursed inspectors and contractors • Provided multiple Heatmaps to clearly demonstrate available personnel for current and future USDA PPIS requirements in all 50 US States and Territories Weaknesses: None Deficienc(ies) None Subfactor 1.3 Management Approach/QASP: Strength(s) • Offeror appraised as a Capability Maturity Model Integration (CMMI) Level 3 company, signifying their expertise in the best practices used to deliver continuous and reliable support services through structured management solutions • Quality assurance: indicated staffing Independent QA team headed by a dedicated QA Manager • Training and Ongoing Support delivered to nationwide staff that would cover RD’s scope of work and administrative roles, responsibilities, policies and procedures • Continuous Process Improvement (CPI )process to learn from previous mistakes • Data Monitoring to ensure assigned timelines and quality metrics are met • [redacted] Weaknesses: None Deficienc(ies) None Subfactor 1.4 Staffing Plan, Key Personnel, Resumes Subcontractors; Subcontracting Plan Strength(s) • Comprehensive training provided to all employee Offeror provided a rational on how it would manage nationwide coverage by [redacted] 17  Weaknesses: None Deficienc(ies) None Subfactor 1.5 Property Management System Strength(s): • [redacted] to keep timelines on track • [redacted] • Demonstrated a [redacted] Weaknesses: None Deficienc(ies) None 3.1.2 PAST PERFORMANCE FACTOR 3.1.2.1 Performance Confidence Assessment - Observations and Conclusions ISN is assigned as Substantial Confidence. Summarily, Offeror provided substantial past performance both for ISN and its major subcontractor [redacted]. The proposal indicated three contracts for past performance, two performed by the prime and one performed by major subcontractor [redacted]. There were no CPARs or PIPRs [Past Performance Information Retrieval System] reported. The team received only one Past Performance Questionnaire for review. The questionnaire from HUD reflected a rating of “Five” (exceeds) in the areas of delivery performance and problem solving and a rating of “four” (meets and occasionally exceeds) in overall quality, quality of service, and quality of personnel (Ref. B20 Performance Evaluation Report). 3.1.3 PRICE FACTOR 3.1.3.1 Summary of Proposed and Evaluated Cost/Price (ISN) – Task Order 1 Price Compared to CPR Task Order 1 CLIN PROPOSED PRICE TO CLINs 1 & 2 CPR CLINs 1 & 2 Inspections CLIN 001 [redacted] [redacted] [redacted] Property Preservations CLIN 002 [redacted] [redacted] [redacted] Reports/NSP CLIN 003 [redacted] 0 Contingency PropPres CLIN 004 [redacted] ODC's-Travel CLIN 005 [redacted] Transition In/Out CLIN 006 [redacted] 0 TOTAL TO CEILING PRICE [redacted] COMPARISON CLIN TASK ORDER /CPR PRICE [redacted] $26,449,756.00 18  COMPETITIVE PRICE CHART ISN [redacted] [redacted] [redacted] MCS [redacted] [redacted] CLIN 001 TOTAL IDIQ 18 $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] CLIN 001 TOTAL TASK $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] ORDER CLIN 002 TOTAL IDIQ 18 $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] CLIN 002 TOTAL TASK $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] ORDER BOTH CLINS TOTAL IDIQ $28,418,630.00 $31,648,267. $35,921,357.00 $40,811,827.00 $[redacted] $50,631,272.00 $60,270,725.00 18 00 BOTH CLINS TOTAL TASK $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] ORDER 12 MONTH CLIN 001 Inspections - Pricing is below the CPR, and comparable to CLIN 001 pricing for MCS, [redacted] and [redacted]. Therefore CLIN 001 is found fair and reasonable. CLIN 002 Property Preservation Services - The individual service items on the price list are lower than the CPR and is competitive with prices received as shown in the chart above. The Offeror indicated in their Vol 3 Price Proposal, that their pricing was “well researched, and was 100 percent compliant, based on existing rates, other Government work similar in nature, numerous independent surveys and market data which lower staffing in their approach.” Further justification for pricing is that the offeror indicated through a clarification that they are aware this requirement is for rural America and that their pricing reflects that fact. Therefore, their price is found realistic and in conformity with their proposed technical approach. The offerors combined CLIN 001 and 002 price is competitive with other offered prices, and in accordance with evaluation criteria set forth in section M paragraph 4., “the Price Factor will become the more dominant factor as technical proposals reach technical equality. In such cases, where all non- priced factors being evaluated are virtually the same, best value may be represented by the lowest-priced proposal.” ISN tied MCS in their technical rating with an “outstanding” but had an overall lower price. ISN is found to be fair and reasonable and has been determined to be the best value with an outstanding technical rating and lowest price out of the two offerors whom received an outstanding rating*Competition Price Results (Ref. B19 Price Proposal Evaluation-Price Competition Memo). (capitalization and emphasis in original). After noting the 11 proposals, the Proposal Analysis Report focused on the two proposals submitted by MCS and ISN: 19 Both MCS and ISN were rated technically “Outstanding” but are as for pricing were at opposite ends of the CPR price spectrum, high to low respectively. MCS’ pricing for the Task Order 1 at $[redacted] is [redacted]% higher than CPR; whereas ISN is significantly lower than CPR by 30% lower. Both MCS and ISN indicated their pricing was based on their respective historical pricing charges to their clients, both Government and private sector. Both Offerors having technically “Outstanding” ratings demonstrated clear understanding of the requirements, and their respective pricing is consistent with their technical approaches in their proposals. Technical Rating: Outstanding– ISN, MCS MCS pricing for Task Order 1 at $[redacted] is [redacted]% over the CPR, and not in line with the competitive price proposals received in response to the solicitation, which made its overall price a high outlier. MCS pricing is based on their historical pricing provided to USDA-RD for the past seven years; and their proposal indicated that their price proposal has been kept consistent with their existing USDA-contract. MCS pricing is found to be fair, reasonable, and realistic for the work to be performed when you take into consideration their exceptional technical approach. They offered a superior technical proposal with an overall Outstanding rating, as well as outstanding in all the subfactors and was assessed as Substantial confidence rating for past performance. However, their offer, as a high outlier, is not determined to be the best value to the Government under this solicitation. ISN pricing on the Task Order 1 at $[redacted] was [redacted]% lower than the CPR, closer in line with the competitive price proposals received in response to the solicitation. ISN indicated that their pricing was based on their historical experience, research, and their technical approach using industry standard technology. ISN pricing was found to be fair, reasonable, and realistic for the work to be performed under the solicitation and in accordance with their exceptional technical approach. ISN offered a technical superior proposal with Outstanding ratings overall and in all the subfactors. They also were assessed a Substantial Confidence rating in Past Performance. With a superior technical proposal and comparative competitive pricing, the Contracting Officer founds and recommends ISN as providing the best overall value to the Government for this solicitation. (See (Ref. B19 Cost/Price Proposal Evaluation – Price Competition Memorandum). 4.1.2 Adequate Price Competition Determination As discussed above four(4) of the eleven(11) offerors competing for the Property Preservation and Inspection contract were determined not to have submitted technical acceptable proposals: CWIS (Marginal); IEI, NHC, UFS (all “Unacceptable”). That left remaining seven(7) that were considered to have a technically “Acceptable” proposals that rated from Acceptable- 20 Good-Outstanding. Of the seven(7), technical acceptable proposal, their pricing for Task Order 1, has a CPR of approximately $25M to $28M, on the CPR price spectrum. Therefore, based on the foregoing findings, and because multiple offers were received from several offerors that were considered responsible and were competing independently for the subject contract, the Technical Evaluation Team (TET) and the Source Selection Authority (SSA) determined that, in accordance with the provisions of FAR 15.403-1, Adequate Price Competition did exist for the procurement. In evaluating price, it was indicated in the solicitation, Attachment C-4, Instructions to Offerors, Evaluation and Basis for Award, par. 4, that “Price is not an adjectivally rated Factor; however, the Price Factor will become the more dominant factor as technical proposals reach technical equality. In such cases, where all nonprice factors being evaluated are virtually the same, best value may be represented by the lowest-priced proposal. Upon information above, and upon performing an integrated assessment of technical (including past performance) and price this competition came down to ISN and MCS, both providing technical exceptional proposals, and competitive pricing as being in line for award. However, in accordance with the solicitation and the CO’s determination and recommendation in the Price Competition Memorandum, of the two exceptionally technically equal offerors, ISN, as the lowest price, provides the best overall value to the Government, with a technically superior proposal at a price that is comparatively competitive, fair and reasonable, balanced and realistic for the work. Therefore, there is no need for establishing a competitive range and going into discussions, because two highly rated exceptional proposals were received and there are no improvements required from either a technical or cost standpoint. There is no basis for a tradeoff between ISN and MCS due to MCS did not supply any features which would warrant the premium in price offered over the lower price offered from ISN. Best value has been established with a superior technical proposal, with substantial past performance confidence rating, and reasonable, balanced and realistic pricing, all resulting in no risk to contract performance. ... 5. AWARD RECOMMENDATION 5.1 Source Selection Recommendation 21  After performing an integrated analysis, the TET Chair & the Contracting Officer hereby recommend to the SSA, awarding to the offeror, Information Systems & Networks Corporation (ISN), the offeror that submitted a proposal under the solicitation that was rated technically superior with an “Outstanding” with pricing that is considered both reasonable, balanced and realistic for the work. Therefore, IAW the terms and conditions set forth in the Property Preservation and Inspection Services, Request for Proposal (RFP), Solicitation 12SAD119R0003, the SSB [Source Selection Board] determined that the proposal submitted by ISN offered the best overall value for satisfying the Government’s stated requirements. The RFP if award would be made to the offeror whose proposal represented the best value to the government using a competitive combination source selection approach. Proposals were evaluated for “Technical Merit” and was rated “Outstanding” and with past performance was assessed as “Substantial Confidence” and the pricing was considered reasonable, balanced and realistic for the work. In adhering to RFP instructions, terms and conditions, the SSB is recommending to the SSA Panel that, “INFORMATION SYSTEMS & NETWORKS CORPORATION” be selected as the contract awardee based on a “Best Value Decision.” It is imperative that this Source Selection Competitive contract be awarded to an offeror that has proven technical capabilities to ensure no interruptions in property preservation and inspections service to occur. Since INFORMATION SYSTEMS & NETWORKS exceeds the technical criteria established in the RFP and offered a fair and reasonable for the Total Evaluated Price for the 12-month Task Order 1, of $[redacted] and the 18-month base IDIQ ceiling at $34,983,380.58, as determined by “Adequate Price Competition, INFORMATION SYSTEMS & NETWORKS CORPORATION is clearly the offeror representing the Best Value to the USDA-RD for the Property Preservation and Inspection Services acquisition. Therefore, the TET Chair and the Contracting Officer puts forward, as a recommendation to the SSA, that INFORMATION SYSTEMS & NETWORKS be awarded this contract. (capitalization and emphasis in original). The contracting officer, Shelia Stoddard, also issued a Price Competition Memo, dated May 29, 2020, which explained that “[a]s part of a Corrective Action Plan, the original cost proposals where [sic] re-evaluated.” With regard to MCS’ pricing, the Price Competition Memo stated: CLIN 001 Inspections - Pricing is below the CPR, and comparable to CLIN 001 pricing for ISN, [redacted], [redacted] and [redacted]. Therefore CLIN 001 is found fair and reasonable. CLIN 002 Property Preservation Services - The individual services items on the price list are higher, especially in the case of [redacted], which are in 22  most instances [redacted]% to [redacted]% over the CPR and on the higher side of the competitive prices offered by the offerors indicated in the competitive chart above. The offeror as the incumbent offered their historical pricing, which have been used the past four years. The offeror maintains the realism of their pricing based on their respective cost experience, their technical approach and the nature of the work for rural America. Summarily, CLIN 001 and 002 combined are higher than the CPR as shown in the table above and compared to other competitive prices received with a technical rating of acceptable or above. This results in their Task Order 1 pricing of $[redacted] approximately $[redacted] higher than the CPR, and for the IDIQ priced at $[redacted] is approximately $[redacted] over the estimated CPR of $[redacted]. Although MCStechincal [sic] rating is outstanding, pricing is at the higher end of the CPR, and is much higher than other similar ranked proposals which precludes them from being in line for an award. Note, in accordance with evaluation criteria set forth in Section M paragraph 4., “the Price Factor will become the more dominant factor as technical proposals reach technical equality. In such cases, where all non- priced factors being evaluated are virtually the same, best value may be represented by the lowest-priced proposal.” (capitalization in original). With regard to ISN’s pricing, the Price Competition Memo stated: CLIN 001 Inspections - Pricing is in line with the CPR, and comparable to CLIN 001 pricing for MCS, [redacted] and [redacted]. Therefore CLIN 001 is found fair and reasonable. CLIN 002 Property Preservation Services - The individual service items on the price list are lower than the CPR, however, are competitive with prices received as shown in the chart above. The Offeror indicated in their Vol 3 Price Proposal, that their pricing was “well researched, and was 100 percent compliant, based on existing rates, other Government work similar in nature, numerous independent surveys and market data which lower staffing in their approach.” Further justification for pricing is that the offeror indicated through a clarification that they are aware this requirement is for rural America and that their pricing reflects that fact. The offerors combined CLIN 001 and 002 price is competitive with other offered prices, and in accordance with evaluation criteria set forth in section M paragraph 4., “the Price Factor will become the more dominant factor as technical proposals reach technical equality. In such cases, where all non- priced factors being evaluated are virtually the same, best value may be represented by the lowest-priced proposal.” ISN tied MCS in their technical rating with an “outstanding” but had an overall lower price. ISN pricing at $[redacted] for Task Order 1; and, IDIQ 23  18-month ceiling of $$34,983,380.00 is found to be fair and reasonable. Their pricing is also determined to be realistic in accordance with their technical approach and understanding of the work, as demonstrated in their “outstanding” technically rated proposal and through clarification, as stated above. (capitalization in original). Under the heading labeled “CONTRACTING OFFICER RECOMMENDATION,” the Price Competition Memo stated: Best Value/Trade-Off. It is found that a trade-off analysis is not required based on my findings in the technical and pricing received from all offerors which had a lower technical rating and higher price than the recommended awardee. Technically, two offerors were rated “outstanding” and there were no discriminators in their technical ratings to lean towards performing a tradeoff. The only discriminator, as indicated below is the divergent pricing, with MCS on the higher spectrum of the CPR, and ISN on the lower side. Note, the solicitation indicated that where all “non-price factors being evaluated are virtually the same, best value may be represented by the lowest-priced proposal.” That is the case as noted below in this competition, where CLINs one and two were evaluated for the task order. (capitalization and emphasis in original). The Price Competition Memo concluded that ISN’s proposal was “the best value with an outstanding technical rating and lowest price out of these two offerors who both received outstanding ratings,” and recommended to the Source Selection Authority that ISN be awarded the contract. On May 29, 2020, the agency issued the Source Selection Decision Document which stated, in part: 4. INDEPENDENT ANALYSIS – FACTORS 1 AND 2 I have accomplished an independent analysis of the information provided in order to accomplish an integrated assessment of the findings of my TET. As noted in the above chart in paragraph 3.1, Factor 1 Overall Ratings indicated that out of the eleven offerors competing for the Property Preservation and Inspection Services solicitation, two were rated rating “Outstanding,”, MCS and ISN. Three Offerors rated as “Good”, namely, [redacted]; and then two rated “Acceptable”, [redacted]. CWIS rating was “Marginal” and lastly, [redacted] were all rated “Unacceptable”. 24 5. INTEGRATED ASSESSMENT AND SOURCE SELECTION The solicitation indicated that to be considered for award, Offerors must be rated overall as “Acceptable”. Since [redacted] were rated below “Acceptable,” and had pricing issues ranging from not fair, reasonable, realistic or balanced, incompliant with the solicitation, their proposals were found to be un-awardable for this solicitation requirement. Five of the Offerors ([redacted]) were rated “Acceptable” to “Good”. Overall, my review concurs with the finding that their respective ratings ranging from “Acceptable” and “Good”, does not demonstrate the highest understanding of the requirement, and therefore un-awardable for this solicitation requirement. Two of the Offerors, ISN and MCS, both rated “Outstanding” demonstrating that their technical proposals provided the highest understanding of the requirement. In addition, both Offerors were assessed Past Performance Confidence rating of “Substantial. However, the greatest discriminator between the Offeror’s proposal was in their pricing. MCS pricing was higher and outside of the competitive pricing of other acceptable offerors; whereas, ISN’s pricing was the lowest, and comparable to the competitive pricing from other CPR range Offerors. Below is an integrated assessment for both MCS and ISN proposals. Information Systems and Network Corporation ISN submitted a superior technical proposal with an overall rating of “Outstanding” in Technical Factor 1, as well as for Subfactor 1.1 thru 1.5. Substantial Confidence was their past performance assessment. As for pricing, their price proposal was found to be fair, reasonable, balanced and realistic for the work to be performed in rural America, in addition to being aligned with their technical approach. Also, it is noted that ISN provided an affirmative response to the clarification question as to their understanding that their pricing was realistic for rural America. ISN’ [sic] proposal demonstrated their relevant experience that far exceeded the solicitation requirement needs. Under Subfactor 1.1, Experience, they have extensive experience in property preservation and Inspection services – REO and foreclosure, to rural and remote areas. ISN contracted with the U.S. Marshals Service (USMS) for 6-years delivering asset management services to a portfolio of over [redacted] seized or forfeited to the Department of Justice (DOJ) Assets Forfeiture Fund and been working with the Department of Housing and Urban Development (HUD) National Servicing Center’s Mortgagee Compliance Manager (MCM) since 2015, servicing over [redacted] properties per year. For Subfactor 1.2, Heatmap, ISN demonstrated thoroughly their capability to provide the available personnel and used multiple heatmaps indicating vendor/subcontractor coverage to all the United States and its Territories. ISN also provided a plan for servicing properties located in Western Pacific US Territories, if needed. Under Subfactor 1.3, ISN’s management 25 approach was strongly demonstrated via and extensive Project Management Plan, that [redacted]. One of their strong attributes is that they are a Capability Maturity Model Integration (CMMI) Level 3 company, which indicates ISN are experts and efficient at using best practices to deliver continuous and reliable support service through structured management solutions. Their proposal also indicated a robust QA team which would have a dedicated QA Manager. Subfactor 1.4, Staffing, Key Personnel, etc. it was demonstrated that the ISN had a thorough staffing plan that would provide nationwide staffing coverage [redacted]. The staffing plan included a detailed narrative on their ability to identify, recruit, screen, onboard, train and retain quality candidates with relevant property preservation experience, including proposed head count at all levels to ensure they can meet the requirements of the PWS. Also, their plan demonstrated ramp-up capabilities. [redacted] ISN’s subcontracting plan at [redacted]% for small businesses, exceeds the 22% RD/SBA [Small Business Administration] goal as stipulated in the solicitation. Subfactor 1.5 Property Management System (PMS), it was demonstrated that the Offeror’s PMS exceeds the requirement’s needs. ISN utilize the software tool “Salesforce” which will fully integrate with USDA LoanServe. ISN system was noted as being able to be [redacted] ISN Past Performance Confidence rating of “Substantial” was reviewed and assessed on information reviewed by the TET on three contracts. Two of the contracts ISN was the Prime and with the third contract performed by their major proposed subcontractor [redacted]. The ISN prime contract values ranged from $22M to 42M, which is comparable in size and scope to this solicitation requirement. There were no CPARs on record. A Past Performance Questionnaire from HUD was received reflecting “Five” (exceeds) in the areas of delivery performance and problem solving and a rating of “four” (meets and occasionally exceeds) in overall quality, quality of service, and quality of personnel. Overall pricing for the Task Order 1 of $[redacted], is aligned with the CPR, and other comparatively priced offerors submitted in response to this solicitation requirement. Further, pricing for some of the individual service items appear to be aligned with the corrective action Attachment 2, Unit Price Analysis, which was an average of other agency’s public price lists. Therefore, their pricing was deemed fair, reasonable, realistic and balanced for the work under this requirement with the unique feature different from other property preservation contracts in that in the commercial market this work is most often in rural areas that are oftentimes difficult to reach. Therefore, I concur with the TET, and the Contracting Officer’s recommendation that ISN’s proposal is determined to be the best value in accordance with the evaluation criteria discussed in the solicitation. 26 Management Contracting Services, LLC (MCS) MCS submitted a superior technical proposal with an overall rating of “Outstanding” in Technical Factor 1, with Subfactor 1.1 thru 1.5 Outstanding; Substantial Confidence past performance assessment. Although a high outlier, their pricing was found to be fair, reasonable, balanced and realistic for the work to be performed in rural American and aligned with their technical approach. MCS’ proposal demonstrated they had the relevant experience that exceeded the requirement needs. MCS is presently the incumbent contractor. Under Subfactor 1.1, Experience, they have successfully provided property preservation and Inspection services to [redacted] properties. For Subfactor 1.2, Heatmap, MCS’s provided a [redacted] areas stipulated in the solicitation. The Subfactor 1.3, their [redacted]; and their QASP was thorough and comprehensive. Findings under Subfactor 1.4, their Staffing information indicated that there is [redacted]. The subcontracting plan exceeded the [redacted]% SBA goal, indicating [redacted]%. Their PMS exceeds what is required by the solicitation [redacted]. MCS’s Past Performance Confidence rating of “Substantial” was based on their successfully performing the requirement as the incumbent contractor; and two other contracts in the private sector. MCS’s Pricing for both the Task Order 1 and IDIQ are well over the respective CPR: Task Order 1 of $[redacted] ( CPR, $28,794,738.00); IDIQ ceiling $[redacted] (CPR $43,239,629.00) and even though deemed fair, reasonable, realistic and balanced in accordance with their technical approach, and historical pricing, their pricing is not competitive for this solicitation. MCS’ price for Task Order 1, at $[redacted] is approximately $[redacted] over ISN price of $21,288,840.00; and for the overall IDIQ is approximately $[redacted] higher. Therefore, I concur with the TET, and the Contracting Officer’s evaluation that MCS’s proposal is not determined to be the best value in accordance with the evaluation criteria discussed in the solicitation. The solicitation, under Attachment C4, par. 4, entitled Competition Instructions, Evaluation and Basis for award, it is [sic] stated that: “Overall, Non-Price Factors, when combined, are significantly more important than Price. Price is not an adjectivally rated Factor; however, the Price Factor will become the more dominant factor as technical proposals reach technical equality. In such cases, where all nonprice factors being 27  evaluated are virtually the same, best value may be represented by the lowest-priced proposal”. Upon reviewing the information provided by the TET, as summarized above for the two technically highest rated Offerors, it is determined that Offeror, Information Systems and Network Corporation clearly provided the best value proposal, all factors considered. Their proposal was technically outstanding as well as appropriately priced and aligned with their technical approach to the solicitation requirement. In my integrated assessment, I reviewed, in detail, both the merits and confidence ratings achieved by the highest rated offerors across the spectrum of evaluation factors and subfactors to select, with certainty, the most highly rated and qualified offeror, given the importance of the individual factors, for this solicitation requirement. In summary, the integrated assessment revealed that INFORMATION SYSTEMS AND NETWORK CORPORATION provided a proposal that generated the best overall value to the Government and yielded the greatest level of confidence that successful performance of the Property Preservation and Inspection Services will be realized. (capitalization and emphasis in original). The Source Selection Decision Document concluded: 6. RECOMMENDATION FROM THE SSB In accordance with the terms and conditions set forth in the “Property Preservation and Inspection Services” Request for Proposal RFP12SAD119R0003, the SSB determined that the proposal submitted by INFORMATION SYSTEMS AND NETWORK CORPORATION offered the best overall value for satisfying the USDA’s stated requirements. 7. SUMMARY DETERMINATION The RFP if award would be made to the offeror whose proposal represented the best value to the government using a competitive combination source selection approach. It also indicated, as noted above, “where all non-priced factors being evaluated are virtually the same, best value may be represented by the lowest-priced proposal”. ISN and MCS’ proposals were both rated as superior proposals with both having key attributes that will successfully meet the Government’s needs with no risk for this solicitation requirement. Their proposals were evaluated and found virtually the same, with no real differentiators between them technically that would require any tradeoff. However, the Offeror’s were on 28  divergent ends in their respective pricing. ISN, is lower, for the Task Order 1 at $[redacted]; and MCS is higher, at $[redacted], which is a $[redacted] difference. And for the IDIQ, ISN overall pricing at $34,983,380.58, is approximately $[redacted] less than MCS overall pricing at $[redacted]. Therefore, the proposal from MCS did not supply any features which would warrant the significantly higher premium in price. Therefore, after a thorough consideration it is determined that INFORMATION SYSTEMS AND NETWORK CORPORATION superior technical solution combined with the cost/price savings of $14.8M on the Task Order 1 and overall on the IDIQ of $22.2M, and past performance assessment of “Substantial Confidence” is a better value to the Government than MCS’s higher priced technical proposal. In summary, based on my integrated assessment of the proposals, and in accordance with the evaluation criteria, set forth in the solicitation, for the “Property Preservation and Inspection Service” it is my decision that the proposal submitted by INFORMATION SYSTEMS AND NETWORK CORPORATION represents the best overall value to the Government. I direct contract award to INFORMATION SYSTEMS AND NETWORK CORPORATION. (capitalization and emphasis in original). On May 29, 2020, the contracting officer sent a letter to ISN, which stated in part, “the stay of contract has been lifted. The agency has resolved the corrective action for the issues alleged in the protest that was filed. As of this date your company can proceed with work under this contract.” The same day, May 29, 2020, the contracting officer sent MCS a letter which stated: The Agency has completed the corrective actions described in its submission to GAO dated February 28, 2020, in bid protest B-418483, and has determined that no Organizational Conflict of Interest (OCI) existed with respect to awardee ISN. In addition, the Agency determined that errors identified in the evaluation process had no effect on the award decision. Accordingly, the stay of performance imposed on ISN that was triggered by your bid protest has been lifted and the transition of services will resume. (capitalization in original).3 Also on May 29, 2020, MCS requested a debriefing after the revised award to ISN, but the contracting officer declined, explaining in a May 29, 2020 email: 3 It is unclear what the errors during the initial evaluations or why the “errors identified in the evaluation process no effect on the award decision.” 29  Consistent with its corrective action notice, the agency has revised its award documentation to reflect the results of the OCI investigation and the correction of identified errors, none of which resulted in a different award decision. Because the decision to award the contract to ISN was merely confirmed, and no new award decision was made, you are not entitled to a debriefing. The information provided in your original debriefing remains unchanged. Except that in the original debrief there was a typographical error in IDIQ Ceiling Price for ISN where it said $[redacted] , and it should have been $34,983,380.58. (capitalization in original). On June 5, 2020 MCS filed a second protest with the GAO, and alleged, “[t]his Protest follows corrective action that USDA took in response to a previous bid protest that MCS filed with your Office, B-418483. USDA informed MCS of its decision to again make award to ISN following the completion of its corrective action process on May 29, 2020.” MCS also stated that “rather than remedy the mistakes in its original evaluation through corrective action, the Agency has repeated and compounded its errors.” MCS alleged that USDA’s new determination to once again make award to ISN is unreasonable and unsupportable. First, ISN has an ‘unequal access to information’ organizational conflict of interest (“OCI”) stemming from its work as a support contractor to the U.S. Department of Housing and Urban Development (“HUD”), through which ISN receives extensive proprietary and confidential information regarding MCS and other property preservation and inspection field operators. The Agency unreasonably failed to disqualify ISN based on that OCI and ISN’s failure to disclose that it had an actual or potential OCI. In addition, USDA failed to recognize the unrealistic nature of ISN’s price proposal, which was apparently based on service pricing that would be appropriate for HUD’s urban property portfolio, but will create significant performance issues in the context of USDA’s rural properties. The Agency also unreasonably awarded ISN the highest possible ratings for Past Performance and Technical Capability. The information that was on ISN’s own website at the time of award makes clear that, under the Solicitation’s stated evaluation criteria, ISN did not warrant the highest rating for either of those Factors. Finally, USDA incorrectly evaluated MCS’ original price proposal, and failed to account for the updated pricing that MCS provided on September 4, 2019. (capitalization and quotation marks in original). On September 10, 2020, the GAO issued its decision and denied all MCS protest grounds. See generally Mortg. Contracting Servs., B-418483.2, B-418483.3, 2020 WL 6625956 (Comp. Gen. Sept. 10, 2020). Regarding the organizational conflict of interest, the GAO found that “the agency meaningfully investigated the alleged OCI and, based on that investigation, reasonably concluded that the invoice information at issue did not 30 provide ISN with an unfair competitive advantage,” and noted that “the contracting officer also determined that access to the invoice information was restricted to certain ISN personnel that had no involvement in the proposal effort,” the GAO determined “that the agency reasonably concluded that ISN did not derive an unfair competitive advantage from its role on the HUD contract.” Id. at *4-5. With regard to MCS’ Past Performance allegations, the GAO explained: While the protester notes aspects of two of ISN's contracts that were dissimilar to the instant effort, the evaluation record demonstrates that ISN's overall past performance and experience supports the agency's assigned ratings. In this respect, ISN submitted two contract references involving property management services, including a contract performed by ISN's subcontractor with a value of $425 million. The third contract, the HUD contract, involved the provision of portfolio management services for approximately 60,000 properties per year. While such services were merely “related to” property preservation and inspection services, we find that the agency nonetheless acted reasonably in considering the HUD contract as part of ISN's overall past performance and relevant experience. In sum, we find that the agency reasonably found that ISN's overall experience and past performance were relevant and merited the high ratings assigned to ISN under those factors. Id. at *8 (internal references omitted). Regarding price, the GAO likewise found “the agency's evaluation to be reasonable,” explaining: In this regard, the agency compared ISN's prices to two benchmarks, the CPR and the AAP. For CLIN 0002, ISN's task order and IDIQ contract prices were more than [DELETED] percent lower than the CPR, but this gap was reduced for the overall IDIQ and task order ceiling prices (19 percent and 26 percent respectively). And, ISN's total prices were largely in line with the AAP pricing index, a benchmark created based on similar federal agency price lists. The protester argues that ISN's pricing is only in line with the AAP because the benchmark is based on the same flawed HUD data set used to create ISN's pricing. We note, however, that the AAP was not based only on prices from HUD properties but was also based on price lists from the Department of Veteran Affairs, FannieMae and FreddieMac. While the protester contends that these other agency pricing lists also do not reflect the realistic costs associated with servicing the rural properties involved in this procurement, we find this assertion to be largely unsupported. In addition to these price comparisons, the agency considered the explanation provided by ISN for its pricing, which was that the pricing was “well researched, and was 100 percent compliant, based on existing rates, other Government work similar in nature, [and] numerous independent surveys and market data.” The agency further issued a clarification asking ISN if it was aware that the requirement is for rural America and if their pricing reflects that fact, to which ISN responded in the affirmative. 31  We conclude that this analysis was reasonable. While the protester asserts that the agency should have examined ISN's pricing with more scrutiny, we find that the depth of the USDA's analysis fell within the sound exercise of its discretion. See Citywide Managing Servs. of Port Washington, Inc., supra. We also find that the agency's use of a second benchmark (the AAP) was a reasonable further step to consider and compare the pricing received to the pricing received by other agencies for similar services, and find no support for the protester's assertion that this extra step was arbitrary or unnecessary. The protest is denied. Mortg. Contracting Servs., LLC, B-418483.2, B-418483.3, 2020 WL 6625956 , at *9-10 (capitalization and brackets in original) (internal references omitted). On September 18, 2020, the protestor filed the above captioned bid protest in the United States Court of Federal Claims and alleged four counts: First, “USDA unreasonably evaluated ISN’s Past Performance Factor,” second, “USDA unreasonably evaluated ISN’s relevant experience subfactor,” third, “the agency unreasonably evaluated ISN’s price realism,” and fourth, “the agency made an unreasonable award determination.”4 Additionally, MCS asserts it has standing to bring the bid protest as an “interested party” upon an allegation of the “USDA’s unreasonable evaluation of ISN’s proposal and the USDA’s arbitrary and capricious determination that ISN represented the best value in accordance with the Solicitation,” and that but for the USDA’s “unreasonable actions, MCS would have had a substantial likelihood of receiving award.” After an initial hearing with the parties, on October 1, 2020, protestor filed a motion for preliminary and permanent injunctive relief. Consistent with the complaint, protestor alleged that the “USDA unreasonably gave ISN a Substantial Confidence rating for Past Performance,” the “USDA Unreasonably Rated ISN as Outstanding for [Technical] Factor 1, Subfactor 1,” and the “USDA failed to properly evaluate ISN’s unrealistically low pricing.” Additionally, regarding protestor’s claim in the amended complaint, that the USDA irrationally failed to assign a deficiency to ISN’s proposal, MCS alleged the “Solicitation included a clear requirement that PWS Tasks 1-6 be performed in accordance with the following AQL [Acceptable Quality Levels]: ‘95% of tasks will be completed within 10 days. The remaining 5% will be completed within 21 days unless there is an exception granted by the Government.’” Protestor argued that “ISN did not meet the AQL requirement to perform 95% of each of PWS Tasks 1-6 within 10 days. Instead, for each of those Tasks, ISN proposed to perform 95% of the work within 14 days,” and the “USDA should have assigned ISN a Deficiency in accordance with the Solicitation’s stated evaluation criteria.” On October 3, 2020, defendant responded to protestor’s claims, first arguing that MCS lacks standing to bring the protest as “the agency determined that because MCS’s proposal price was unreasonably high, MCS could not be in line for the award,” and “there 4Protestor did not raise the issue of organizational conflict of interest at the United States Court of Federal Claims as it had in both GAO protests. 32 is no substantial chance that MCS would have received the contract award, and the Court should dismiss this protest for lack of standing.” On the merits defendant argued that [a]s it relates to MCS’s challenge of the agency’s evaluation of ISN’s technical and past performance proposal, MCS contends that ISN does not meet the “Relevant Experience” and “Past Performance” requirements. MCS reads into the solicitation language that is not there. MCS complains that ISN’s past performance examples did not involve precisely the same type and quantity of work as the present contract. But those requirements are absent from the solicitation, and MCS’s argument is meritless in that absence. Defendant further argued, “[a]s it relates to MCS’s challenge of ISN’s pricing proposal, MCS complains that ISN’s pricing was unrealistically low. MCS cites nothing in support of this argument beyond its own assessment that performing the scope of work would cost more than ISN’s proposed price.” Regarding protestor’s additional claim, defendant argued that “MCS ignores that the solicitation required the agency to evaluate an offeror’s Technical Approach under five sub-factors. MCS fails to identify the relevant sub-factor (Management Approach) under which the agency evaluated the narrative and fails to cite the evaluation criteria for the relevant sub-factor.” Also on October 3, 2020 intervenor filed its opposition to protestor’s motion for injunctive relief, first alleging that MCS does not have standing to bring suit for the injunction, and, second, if MCS does have standing, MCS would not succeed on the merits because the USDA’s past performance evaluation was reasonable, the USDA properly evaluated the ISN proposal in Technical Capacity subfactor 1.1, the USDA properly evaluated the price realism of the ISN proposal, and that evaluation should be upheld. Regarding protestor’s additional claim in the amended complaint, ISN argued that “[a] full and fair read of ISN’s proposal” “shows that ISN repeatedly confirmed it would meet all required timeframes,” and the “USDA reasonably determined that ISN’s proposal met the Solicitation’s requirements.” After all the submissions were reviewed, and in response to the agency’s request that a decision be made as soon as possible, the court issued an oral decision to the parties, and explanation of its decision. The court’s oral decision granted protestor’s motion for injunctive relief, effective immediately. As noted above, this decision incorporates and memorializes the oral decision. DISCUSSION Rule 52.1(c)(1) (2020) of the Rules of the United States Court of Federal Claims (RCFC) governs motions for judgment on the administrative record. The court’s inquiry is directed to “‘whether, given all the disputed and undisputed facts, a party has met its burden of proof based on the evidence in the record.’” Mgmt. & Training Corp. v. United States, 115 Fed. Cl. 26 , 40 (2014) (quoting A & D Fire Prot., Inc. v. United States, 72 Fed. Cl. 126 , 131 (2006) see also Superior Optical Labs, Inc. v. United States, 150 Fed. Cl. 681 , 691 (2020) (citing Bannum, Inc. v. United States, 404 F.3d 1346 , 1356-57 (Fed. Cir. 2005)); see also AAR Manufacturing, Inc. v. United States, 149 Fed. Cl. 514 , 522 (2020); 33 Glocoms, Inc. v. United States, 149 Fed. Cl. 725 , 731 (2020); Centerra Grp., LLC v. United States, 138 Fed. Cl. 407 , 412 (2018) (citing Bannum, Inc. v. United States, 404 F.3d at 1356-57 ); Informatics Applications Grp., Inc. v. United States, 132 Fed. Cl. 519 , 524 (2017) (citation omitted); Strategic Bus. Sols., Inc. v. United States, 129 Fed. Cl. 621 , 627 (2016), aff’d, 711 F. App’x 651 (Fed. Cir. 2018); Rotech Healthcare Inc. v. United States, 118 Fed. Cl. 408 , 413 (2014); Eco Tour Adventures, Inc. v. United States, 114 Fed. Cl. 6 , 21 (2013); DMS All-Star Joint Venture v. United States, 90 Fed. Cl. 653 , 661 (2010). Pursuant to RCFC 52.1, in a bid protest, the court reviews the agency’s procurement decision to determine whether it is supported by the administrative record. See CW Gov’t Travel, Inc. v. United States, 110 Fed. Cl. 462 , 481 (2013); see also CR/ZWS LLC v. United States, 138 Fed. Cl. 212 , 223 (2018) (citing Bannum, Inc. v. United States, 404 F.3d at 1353-54 ). The Administrative Dispute Resolution Act of 1996 (ADRA), Pub. L. No. 104-320, §§ 12(a), 12(b), 110 Stat. 3870 , 3874 (1996) (codified at 28 U.S.C. § 1491 (b)(1)–(4)), amended the Tucker Act to establish a statutory basis for bid protests in the United States Court of Federal Claims. See Impresa Construzioni Geom. Domenico Garufi v. United States, 238 F.3d 1324 , 1330-32 (Fed. Cir. 2001); see also Sys. Application & Techs., Inc. v. United States, 691 F.3d 1374 , 1380 (Fed. Cir. 2012) (explaining that the Tucker Act expressly waives sovereign immunity for claims against the United States in bid protests). The statute provides that protests of agency procurement decisions are to be reviewed under APA standards, making applicable the standards outlined in Scanwell Labs., Inc. v. Shaffer, 424 F.2d 859 (D.C. Cir. 1970), and the line of cases following that decision. See, e.g., Per Aarsleff A/S v. United States, 829 F.3d 1303 , 1309 (Fed. Cir. 2016) (“Protests of agency procurement decisions are reviewed under the standards set forth in the Administrative Procedure Act (‘APA’), see 28 U.S.C. § 1491 (b)(4) (citing 5 U.S.C. § 706 ), ‘by which an agency’s decision is to be set aside only if it is arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law[.]’” (quoting NVT Techs., Inc. v. United States, 370 F.3d 1153 , 1159 (Fed. Cir. 2004)) (citing PAI Corp. v. United States, 614 F.3d 1347 , 1351 (Fed. Cir. 2010))); Impresa Construzioni Geom. Domenico Garufi v. United States, 238 F.3d at 1332 ; Res. Conservation Grp., LLC v. United States, 597 F.3d 1238 , 1242 (Fed. Cir. 2010) (“Following passage of the APA in 1946, the District of Columbia Circuit in Scanwell Labs., Inc. v. Shaffer, 424 F.2d 859 (D.C. Cir. 1970), held that challenges to awards of government contracts were reviewable in federal district courts pursuant to the judicial review provisions of the APA.”); Galen Med. Assocs., Inc. v. United States, 369 F.3d 1324 , 1329 (Fed. Cir.) (citing Scanwell Labs., Inc. v. Shaffer, 424 F.2d at 864, 868 , for its “reasoning that suits challenging the award process are in the public interest and disappointed bidders are the parties with an incentive to enforce the law”), reh’g denied (Fed. Cir. 2004). In Banknote Corp. of Am., Inc. v. United States, 365 F.3d 1345 (Fed. Cir. 2004), the Federal Circuit explained that “[u]nder the APA standard as applied in the Scanwell line of cases, and now in ADRA cases, ‘a bid award may be set aside if either (1) the procurement official’s decision lacked a rational basis; or (2) the procurement procedure involved a violation of regulation or procedure.’” Id. at 1351 (quoting Impresa Construzioni Geom. Domenico Garufi v. United States, 238 F.3d at 1332 )); see also Palantir USG, Inc. v. United States, 904 F.3d 980 , 990 (Fed. Cir. 2018); AgustaWestland North Am., Inc. v. United States, 880 F.3d 1326 , 1332 (Fed. Cir. 34 2018); Info. Tech. & Applications Corp. v. United States, 316 F.3d 1312 , 1319 (Fed. Cir.), reh’g and reh’g en banc denied (Fed. Cir. 2003). When discussing the appropriate standard of review for bid protest cases, the United States Court of Appeals for the Federal Circuit addressed subsections (2)(A) and (2)(D) of 5 U.S.C. § 706 , see Impresa Construzioni Geom. Domenico Garufi v. United States, 238 F.3d at 1332 n.5, but focused its attention primarily on subsection (2)(A). See Croman Corp. v. United States, 724 F.3d 1357 , 1363 (Fed. Cir.) (“‘[T]he proper standard to be applied [to the merits of] bid protest cases is provided by 5 U.S.C. § 706 (2)(A) [(2006)]: a reviewing court shall set aside the agency action if it is “arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.”’” (alterations in original) (quoting Banknote Corp. of Am. v. United States, 365 F.3d at 1350-51 (citing Advanced Data Concepts, Inc. v. United States, 216 F.3d 1054 , 1057-58 (Fed. Cir.), reh’g denied (Fed. Cir. 2000)))), reh’g and reh’g en banc denied (Fed. Cir. 2013). The statute says that agency procurement actions should be set aside when they are “arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law,” or “without observance of procedure required by law.” 5 U.S.C. § 706 (2)(A), (D) (2018);5 see also Veterans 5 The language of 5 U.S.C. § 706 provides in full: To the extent necessary to decision and when presented, the reviewing court shall decide all relevant questions of law, interpret constitutional and statutory provisions, and determine the meaning or applicability of the terms of an agency action. The reviewing court shall— (1) compel agency action unlawfully withheld or unreasonably delayed; and (2) hold unlawful and set aside agency action, findings, and conclusions found to be— (A) arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law; (B) contrary to constitutional right, power, privilege, or immunity; (C) in excess of statutory jurisdiction, authority, or limitations, or short of statutory right; (D) without observance of procedure required by law; (E) unsupported by substantial evidence in a case subject to sections 556 and 557 of this title or otherwise reviewed on the record of an agency hearing provided by statute; or (F) unwarranted by the facts to the extent that the facts are subject to trial de novo by the reviewing court. In making the foregoing determinations, the court shall review the whole record or those parts of it cited by a party, and due account shall be taken of the rule of prejudicial error. 5 U.S.C. § 706 . 35 Contracting Grp., Inc. v. United States, 920 F.3d 801 , 806 (Fed. Cir. 2019) (“In a bid protest, we follow Administrative Procedure Act § 706 and set aside agency action ‘if it is arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.’” (quoting Palladian Partners, Inc. v. United States, 783 F.3d 1243 , 1252 (Fed. Cir. 2015)); Tinton Falls Lodging Realty, LLC v. United States, 800 F.3d 1353 , 1358 (Fed. Cir. 2015); Orion Tech., Inc. v. United States, 704 F.3d 1344 , 1347 (Fed. Cir. 2013); COMINT Sys. Corp. v. United States, 700 F.3d 1377 , 1381 (Fed. Cir. 2012) (“We evaluate agency actions according to the standards set forth in the Administrative Procedure Act; namely, for whether they are ‘arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.’” (quoting 5 U.S.C. § 706 (2)(A); and Bannum, Inc. v. United States, 404 F.3d at 1351 )); Savantage Fin. Servs. Inc., v. United States, 595 F.3d 1282 , 1285-86 (Fed. Cir. 2010); Weeks Marine, Inc. v. United States, 575 F.3d 1352 , 1358 (Fed. Cir. 2009); Axiom Res. Mgmt., Inc. v. United States, 564 F.3d at 1381 (noting arbitrary and capricious standard set forth in 5 U.S.C. § 706 (2)(A), and reaffirming the analysis of Impresa Construzioni Geom. Domenico Garufi v. United States, 238 F.3d at 1332 ); Blue & Gold Fleet, L.P. v. United States, 492 F.3d 1308 , 1312 (Fed. Cir. 2007) (“‘[T]he inquiry is whether the [government]’s procurement decision was “arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.”’” (quoting Bannum, Inc. v. United States, 404 F.3d at 1351 (quoting 5 U.S.C. § 706 (2)(A) (2000)))); NVT Techs., Inc. v. United States, 370 F.3d at 1159 (“Bid protest actions are subject to the standard of review established under section 706 of title 5 of the Administrative Procedure Act (‘APA’), 28 U.S.C. § 1491 (b)(4) (2000), by which an agency’s decision is to be set aside only if it is ‘arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law,’ 5 U.S.C. § 706 (2)(A) (2000).” (internal citations omitted)); Info. Tech. & Applications Corp. v. United States, 316 F.3d at 1319 (“Consequently, our inquiry is whether the Air Force’s procurement decision was ‘arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.’ 5 U.S.C. § 706 (2)(A) (2000).”); Synergy Sols., Inc. v. United States, 133 Fed. Cl. 716 , 734 (2017) (citing Banknote Corp. of Am. v. United States, 365 F.3d at 1350 ); Eco Tour Adventures, Inc. v. United States, 114 Fed. Cl. at 22; Contracting, Consulting, Eng’g LLC v. United States, 104 Fed. Cl. 334 , 340 (2012). “In a bid protest case, the agency’s award must be upheld unless it is ‘arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.’” Turner Constr. Co. v. United States, 645 F.3d 1377 , 1383 (Fed. Cir.) (quoting PAI Corp. v. United States, 614 F.3d at 1351 ), reh’g en banc denied (Fed. Cir. 2011); see also Tinton Falls Lodging Realty, LLC v. United States, 800 F.3d at 1358 (“In applying this [arbitrary and capricious] standard to bid protests, our task is to determine whether the procurement official’s decision lacked a rational basis or the procurement procedure involved a violation of a regulation or procedure.” (citing Savantage Fin. Servs., Inc. v. United States, 595 F.3d at 1285-86)); Glenn Def. Marine (ASIA), PTE Ltd. v. United States, 720 F.3d 901 , 907 (Fed. Cir.), reh’g en banc denied (Fed. Cir. 2013); McVey Co., Inc. v. United States, 111 Fed. Cl. 387 , 402 (2013) (“The first step is to demonstrate error, that is, to show that the agency acted in an arbitrary and capricious manner, without a rational basis or contrary to law.”); PlanetSpace, Inc. v. United States, 92 Fed. Cl. 520 , 531-32 (“Stated another way, a plaintiff must show that the agency’s decision either lacked a rational basis or was contrary to law.” (citing Weeks Marine, Inc. v. United States, 575 F.3d at 1358)), subsequent determination, 96 Fed. Cl. 119 (2010). 36  The United States Supreme Court has identified sample grounds which can constitute arbitrary or capricious agency action: [W]e will not vacate an agency’s decision unless it “has relied on factors which Congress has not intended it to consider, entirely failed to consider an important aspect of the problem, offered an explanation for its decision that runs counter to the evidence before the agency, or is so implausible that it could not be ascribed to a difference in view or the product of agency expertise.” Nat’l Ass’n of Home Builders v. Defenders of Wildlife, 551 U.S. 644 , 658 (2007) (quoting Motor Vehicle Mfrs. Ass’n v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29 , 43 (1983)); see also F.C.C. v. Fox Television Stations, Inc., 556 U.S. 502 , 552 (2009); Tinton Falls Lodging Realty, LLC v. United States, 800 F.3d at 1358; Ala. Aircraft Indus., Inc.- Birmingham v. United States, 586 F.3d 1372 , 1375 (Fed. Cir. 2009), reh’g and reh’g en banc denied (Fed. Cir. 2010); In re Sang Su Lee, 277 F.3d 1338 , 1342 (Fed. Cir. 2002) (“[T]he agency tribunal must present a full and reasoned explanation of its decision. . . . The reviewing court is thus enabled to perform meaningful review . . . .”); Textron, Inc. v. United States, 74 Fed. Cl. 277 , 285-86 (2006), appeal dismissed sub nom. Textron, Inc. v. Ocean Technical Servs., Inc., 223 F. App’x 974 (Fed. Cir. 2007). The United States Supreme Court also has cautioned, however, that “courts are not free to impose upon agencies specific procedural requirements that have no basis in the APA.” Pension Benefit Guar. Corp. v. LTV Corp., 496 U.S. 633 , 654 (1990). Under an arbitrary or capricious standard, the reviewing court should not substitute its judgment for that of the agency, but should review the basis for the agency decision to determine if it was legally permissible, reasonable, and supported by the facts. See Motor Vehicle Mfrs. Ass’n v. State Farm Mut. Auto. Ins. Co., 463 U.S. at 43 (“The scope of review under the ‘arbitrary and capricious’ standard is narrow and a court is not to substitute its judgment for that of the agency.”); see also Dell Fed. Sys., L.P. v. United States, 906 F.3d 982 , 990 (Fed. Cir. 2018); Turner Constr. Co., Inc. v. United States, 645 F.3d at 1383 ; R & W Flammann GmbH v. United States, 339 F.3d 1320 , 1322 (Fed. Cir. 2003) (citing Ray v. Lehman, 55 F.3d 606 , 608 (Fed. Cir.), cert. denied, 516 U.S. 916 (1995)); Synergy Sols., Inc. v. United States, 133 Fed. Cl. at 735 (citing Impresa Construzioni Geom. Domenico Garufi v. United States, 238 F.3d at 1332-33 ). “‘“If the court finds a reasonable basis for the agency’s action, the court should stay its hand even though it might, as an original proposition, have reached a different conclusion as to the proper administration and application of the procurement regulations.”’” Weeks Marine, Inc. v. United States, 575 F.3d at 1371 (quoting Honeywell, Inc. v. United States, 870 F.2d 644 , 648 (Fed. Cir. 1989) (quoting M. Steinthal & Co. v. Seamans, 455 F.2d 1289 , 1301 (D.C. Cir. 1971))); Limco Airepair, Inc. v. United States, 130 Fed. Cl. 544 , 550 (2017) (citation omitted); Jordan Pond Co., LLC v. United States, 115 Fed. Cl. 623 , 631 (2014); Davis Boat Works, Inc. v. United States, 111 Fed. Cl. 342 , 349 (2013); Norsat Int’l [America], Inc. v. United States, 111 Fed. Cl. 483 , 493 (2013); HP Enter. Servs., LLC v. United States, 104 Fed. Cl. 230 , 238 (2012); Vanguard Recovery Assistance v. United States, 101 Fed. Cl. 765 , 780 (2011). 37  Stated otherwise by the United States Supreme Court: Section 706(2)(A) requires a finding that the actual choice made was not “arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.” To make this finding the court must consider whether the decision was based on a consideration of the relevant factors and whether there has been a clear error of judgment. Although this inquiry into the facts is to be searching and careful, the ultimate standard of review is a narrow one. The court is not empowered to substitute its judgment for that of the agency. Citizens to Pres. Overton Park, Inc. v. Volpe, 401 U.S. 402 , 416 (1971) (internal citations omitted), abrogated on other grounds by Califano v. Sanders, 430 U.S. 99 (1977); see also U.S. Postal Serv. v. Gregory, 534 U.S. 1 , 6-7 (2001); Bowman Transp., Inc. v. Arkansas-Best Freight Sys., Inc., 419 U.S. 281 , 285 (1974), reh’g denied, 420 U.S. 956 (1975); Co-Steel Raritan, Inc. v. Int’l Trade Comm’n, 357 F.3d 1294 , 1309 (Fed. Cir. 2004) (In discussing the “arbitrary, capricious, and abuse of discretion, or otherwise not in accordance with the law” standard, the Federal Circuit stated: “the ultimate standard of review is a narrow one. The court is not empowered to substitute its judgment for that of the agency.”); In re Sang Su Lee, 277 F.3d at 1342 ; Advanced Data Concepts, Inc. v. United States, 216 F.3d at 1058 (“The arbitrary and capricious standard applicable here is highly deferential. This standard requires a reviewing court to sustain an agency action evincing rational reasoning and consideration of relevant factors.” (citing Bowman Transp., Inc. v. Arkansas-Best Freight Sys., Inc., 419 U.S. at 285)); Lockheed Missiles & Space Co. v. Bentsen, 4 F.3d 955 , 959 (Fed. Cir. 1993); Sys. Studies & Simulation, Inc. v. United States, 146 Fed. Cl. 186 , 199 (2019); By Light Prof’l IT Servs., Inc. v. United States, 131 Fed. Cl. 358 , 366 (2017); BCPeabody Constr. Servs., Inc. v. United States, 112 Fed. Cl. 502 , 508 (2013) (“The court ‘is not empowered to substitute its judgment for that of the agency,’ and it must uphold an agency’s decision against a challenge if the ‘contracting agency provided a coherent and reasonable explanation of its exercise of discretion.’” (internal citations omitted) (quoting Keeton Corrs., Inc. v. United States, 59 Fed. Cl. 753 , 755, recons. denied, 60 Fed. Cl. 251 (2004); and Axiom Res. Mgmt., Inc. v. United States, 564 F.3d at 1381)), appeal dismissed, 559 F. App’x 1033 (Fed. Cir. 2014); Supreme Foodservice GmbH v. United States, 109 Fed. Cl. at 382; Alamo Travel Grp., LP v. United States, 108 Fed. Cl. 224 , 231 (2012); ManTech Telecomms. & Info. Sys. Corp. v. United States, 49 Fed. Cl. 57 , 63 (2001), aff’d, 30 F. App’x 995 (Fed. Cir. 2002). According to the United States Court of Appeals for the Federal Circuit: Effective contracting demands broad discretion. Burroughs Corp. v. United States, 223 Ct. Cl. 53 , 617 F.2d 590 , 598 (1980); Sperry Flight Sys. Div. v. United States, 548 F.2d 915 , 921, 212 Ct. Cl. 329 (1977); see NKF Eng’g, Inc. v. United States, 805 F.2d 372 , 377 (Fed. Cir. 1986); Tidewater Management Servs., Inc. v. United States, 573 F.2d 65 , 73, 216 Ct. Cl. 69 (1978); RADVA Corp. v. United States, 17 Cl. Ct. 812 , 819 (1989), aff’d, 914 F.2d 271 (Fed. Cir. 1990). Accordingly, agencies “are entrusted with a good deal of discretion in determining which bid is the most advantageous to the Government.” Tidewater Management Servs., 573 F.2d at 73, 216 Ct. Cl. 69 . 38 Lockheed Missiles & Space Co. v. Bentsen, 4 F.3d at 958-59 ; see also Res-Care, Inc. v. United States, 735 F.3d 1384 , 1390 (Fed. Cir.) (“DOL [Department of Labor], as a federal procurement entity, has ‘broad discretion to determine what particular method of procurement will be in the best interests of the United States in a particular situation.’” (quoting Tyler Constr. Grp. v. United States, 570 F.3d 1329 , 1334 (Fed. Cir. 2009))), reh’g en banc denied (Fed. Cir. 2014); Grumman Data Sys. Corp. v. Dalton, 88 F.3d 990 , 995 (Fed. Cir. 1996); Geo-Med, LLC v. United States, 126 Fed. Cl. 440 , 449 (2016); Cybertech Grp., Inc. v. United States, 48 Fed. Cl. 638 , 646 (2001) (“The court recognizes that the agency possesses wide discretion in the application of procurement regulations.”); Furthermore, according to the United States Court of Appeals for the Federal Circuit: Contracting officers “are entitled to exercise discretion upon a broad range of issues confronting them in the procurement process.” Impresa Construzioni Geom. Domenico Garufi v. United States, 238 F.3d 1324 , 1332 (Fed. Cir. 2001) (internal quotation marks omitted). Accordingly, procurement decisions are subject to a “highly deferential rational basis review.” CHE Consulting, Inc. v. United States, 552 F.3d 1351 , 1354 (Fed. Cir. 2008) (internal quotation marks omitted). PAI Corp. v. United States, 614 F.3d at 1351 ; see also AgustaWestland N. Am., Inc. v. United States, 880 F.3d at 1332 (“Where, as here, a bid protester challenges the procurement official’s decision as lacking a rational basis, we must determine whether ‘the contracting agency provided a coherent and reasonable explanation of its exercise of discretion,’ recognizing that ‘contracting officers are entitled to exercise discretion upon a broad range of issues confronting them in the procurement process.’” (quoting Impresa Construzioni Geom. Domenico Garufi v. United States, 238 F.3d at 1332-33 (internal quotation marks and citation omitted))); Weeks Marine, Inc. v. United States, 575 F.3d at 1368-69 (“We have stated that procurement decisions ‘invoke [ ] “highly deferential” rational basis review.’ Under that standard, we sustain an agency action ‘evincing rational reasoning and consideration of relevant factors.’” (alteration in original) (quoting CHE Consulting, Inc. v. United States, 552 F.3d at 1354 (quoting Advanced Data Concepts, Inc. v. United States, 216 F.3d at 1058 ))). “Contracting officers ‘are entitled to exercise discretion upon a broad range of issues confronting them in the procurement process,’” PAI Corp. v. United States, 614 F.3d at 1351 (quoting Impresa Construzioni Geom. Domenico Garufi v. United States, 238 F.3d at 1332 ), and “[a]ccordingly, procurement decisions are subject to a ‘highly deferential rational basis review.’” Id. (quoting CHE Consulting, Inc. v. United States, 552 F.3d at 1354 (Fed. Cir. 2008) (internal quotation marks omitted). When the contracting officer’s discretion grows, so does the burden on the protestor. As noted in D & S Consultants, Inc. v. United States: The protestor’s burden becomes more difficult the greater the degree of discretion vested in the contracting officer. DynCorp Int’l v. United States, 76 Fed. Cl. 528 , 537 (2007). Negotiated procurements afford the contracting officer a “breadth of discretion;” “best-value” awards afford the contracting 39  officer additional discretion. Id. Therefore, in a negotiated, best-value procurement, the “protestor’s burden is especially heavy.” Id. D & S Consultants, Inc. v. United States, 101 Fed. Cl. 23 , 33 (2011), aff’d, 484 F. App’x 558 (Fed. Cir. 2012); see also Galen Med. Assocs., Inc. v. United States, 369 F.3d at 1330 (noting that contracting officers have great discretion in negotiated procurements but even greater discretion in best-value determinations than in procurements based on cost alone); PHT Supply Corp. v. United States, 71 Fed. Cl. 1 , 11 (2006) (“It is critical to note that ‘a protestor’s burden is particularly great in negotiated procurements because the contracting officer is entrusted with a relatively high degree of discretion, and greater still, where, as here, the procurement is a “best-value” procurement.’” (citations omitted)). “It is well-established that contracting officers have a great deal of discretion in making contract award decisions, particularly when, as here, the contract is to be awarded to the bidder or bidders that will provide the agency with the best value.” Banknote Corp. of Am. Inc. v. United States, 365 F.3d at 1355 (citing TRW, Inc. v. Unisys Corp., 98 F.3d 1325 , 1327-28 (Fed. Cir. 1996); E.W. Bliss Co. v. United States, 77 F.3d 445 , 449 (Fed. Cir. 1996); Lockheed Missiles & Space Co. v. Bentsen, 4 F.3d at 958–59); see also Am. Tel. & Tel. Co. v. United States, 307 F.3d 1374 , 1379 (Fed. Cir. 2002); Lockheed Missiles & Space Co. v. Bentsen, 4 F.3d at 958 ; Brooks Range Contract Servs., Inc. v. United States, 101 Fed. Cl. 699 , 707 (2011) (“[A] plaintiff’s burden ‘is elevated where the solicitation contemplates award on a “best value” basis.’” (internal citations omitted)); Matt Martin Real Estate Mgmt. LLC v. United States, 96 Fed. Cl. 106 , 113 (2010); Serco v. United States, 81 Fed. Cl. 463 , 496 (2008) (“To be sure, as noted at the outset, plaintiffs have a significant burden of showing error in that regard because a court must accord considerable deference to an agency’s best-value decision in trading off price with other factors.”). A disappointed bidder has the burden of demonstrating the arbitrary and capricious nature of the agency decision by a preponderance of the evidence. See Tinton Fall Lodging Realty, LLC v. United Sates, 800 F.3d at 1364; see also Grumman Data Sys. Corp. v. Dalton, 88 F.3d at 995-96 ; Enhanced Veterans Sols., Inc. v. United States, 131 Fed. Cl. 565 , 578 (2017); Davis Boat Works, Inc. v. United States, 111 Fed. Cl. at 349; Contracting, Consulting, Eng’g LLC v. United States, 104 Fed. Cl. at 340. The Federal Circuit has indicated that “[t]his court will not overturn a contracting officer’s determination unless it is arbitrary, capricious, or otherwise contrary to law. To demonstrate that such a determination is arbitrary or capricious, a protester must identify ‘hard facts’; a mere inference or suspicion . . . is not enough.” PAI Corp. v. United States, 614 F.3d at 1352 (citing John C. Grimberg Co. v. United States, 185 F.3d 1297 , 1300 (Fed. Cir. 1999)); see also Turner Constr. Co., Inc. v. United States, 645 F.3d at 1387 ; Sierra Nevada Corp. v. United States, 107 Fed. Cl. 735 , 759 (2012); Filtration Dev. Co., LLC v. United States, 60 Fed. Cl. 371 , 380 (2004). A bid protest proceeds in two steps. First . . . the trial court determines whether the government acted without rational basis or contrary to law when evaluating the bids and awarding the contract. Second . . . if the trial court finds that the government’s conduct fails the APA review under 5 U.S.C. § 706 (2)(A), then it proceeds to determine, as a factual matter, if the bid protester was prejudiced by that conduct. 40 Bannum, Inc. v. United States, 404 F.3d at 1351 ; T Square Logistics Servs. Corp. v. United States, 134 Fed. Cl. 550 , 555 (2017); FirstLine Transp. Sec., Inc. v. United States, 119 Fed. Cl. 116 , 126 (2014), appeal dismissed (Fed. Cir. 2015); Eco Tour Adventures, Inc. v. United States, 114 Fed. Cl. at 22; Archura LLC v. United States, 112 Fed. Cl. at 496. To prevail in a bid protest case, the protestor not only must show that the government’s actions were arbitrary, capricious, or otherwise not in accordance with the law, but the protestor also must show that it was prejudiced by the government’s actions. See 5 U.S.C. § 706 (“[D]ue account shall be taken of the rule of prejudicial error.”); see also Glenn Def. Marine (ASIA), PTE Ltd. v. United States, 720 F.3d at 907 (“In a bid protest case, the inquiry is whether the agency’s action was arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law and, if so, whether the error is prejudicial.”); IT Enter. Sols. JV, LLC v. United States, 132 Fed. Cl. 158 , 173 (2017) (citing Bannum v. United States, 404 F.3d at 1357-58 ); Linc Gov’t Servs., LLC v. United States, 96 Fed. Cl. 672 , 694-96 (2010). In describing the prejudice requirement, the Federal Circuit also has held that: To prevail in a bid protest, a protester must show a significant, prejudicial error in the procurement process. See Statistica, Inc. v. Christopher, 102 F.3d 1577 , 1581 (Fed. Cir. 1996); Data Gen. Corp. v. Johnson, 78 F.3d 1556 , 1562 (Fed. Cir. 1996). “To establish prejudice, a protester is not required to show that but for the alleged error, the protester would have been awarded the contract.” Data General, 78 F.3d at 1562 (citation omitted). Rather, the protester must show “that there was a substantial chance it would have received the contract award but for that error.” Statistica, 102 F.3d at 1582 ; see CACI, Inc.-Fed. v. United States, 719 F.2d 1567 , 1574-75 (Fed. Cir. 1983) (to establish competitive prejudice, protester must demonstrate that but for the alleged error, “‘there was a substantial chance that [it] would receive an award--that it was within the zone of active consideration.’” (citation omitted)). Alfa Laval Separation, Inc. v. United States, 175 F.3d 1365 , 1367 (Fed. Cir.), reh’g denied (Fed. Cir. 1999); see also Glenn Def. Marine (ASIA), PTE Ltd. v. United States, 720 F.3d at 912; Allied Tech. Grp., Inc. v. United States, 649 F.3d 1320 , 1326 (Fed. Cir.), reh’g en banc denied (Fed. Cir. 2011); Info. Tech. & Applications Corp. v. United States, 316 F.3d at 1319 ; Impresa Construzioni Geom. Domenico Garufi v. United States, 238 F.3d at 1332-33 ; OMV Med., Inc. v. United States, 219 F.3d 1337 , 1342 (Fed. Cir. 2000); Advanced Data Concepts, Inc. v. United States, 216 F.3d at 1057 ; Stratos Mobile Networks USA, LLC v. United States, 213 F.3d 1375 , 1380 (Fed. Cir. 2000). Past Performance Regarding the agency’s evaluation of ISN’s past performance, MCS argued that the “USDA failed to follow the Solicitation’s stated criteria in evaluating ISN’s Past Performance submission. In particular, USDA failed to recognize that two out of ISN’s three Past Performance examples did not meet the Solicitation’s established criteria for relevance.” Defendant responded that the USDA’s Past Performance evaluation was reasonable and in accordance with the Solicitation,” and intervenor similarly argued that the “USDA’s past performance evaluation was reasonable.” 41  Consistent with the above arbitrary or capricious standard, a Judge of the United States Court of Federal Claims explained, “[i]n the bid protest context, the assignment of a past performance rating is reviewed ‘only to ensure that it was reasonable and consistent with the stated evaluation criteria and applicable statutes and regulations, since determining the relative merits of the offerors’ past performance is primarily a matter within the contracting agency’s discretion.’” Todd Constr., L.P. v. United States, 88 Fed. Cl. 235 , 247 (2009) (quoting Clean Venture, Inc., B-284176, 2000 WL 253581 , at *3 (Comp. Gen. Mar. 6, 2000)), aff’d, 656 F.3d 1306 (Fed. Cir. 2011); see also Glenn Def. Marine (ASIA), PTE Ltd. v. United States, 720 F.3d at 911 (citing E.W. Bliss Co. v. United States, 77 F.3d at 449 ); Vanguard Recovery Assistance v. United States, 101 Fed. Cl. at 785 (It is a “‘well-recognized’ principle that ‘an agency’s evaluation of past performance is entitled to great deference.’” (quoting Al Andalus Gen. Contracts Co. v. United States, 86 Fed. Cl. 252 , 264 (2009) (citing Westech Int’l, Inc. v. United States, 79 Fed. Cl. 272 , 293 (2007)))); SP Sys., Inc. v. United States, 86 Fed. Cl. 1 , 23 (2009) (A “past performance evaluation ‘will not be disturbed unless it is unreasonable or inconsistent with the terms of the solicitation or applicable statutes or regulations.’” (quoting Consol. Eng’g Servs., Inc. v. United States, 64 Fed. Cl. at 637)). “‘When the Court considers a bid protest challenge to a past performance evaluation conducted in the course of a negotiated procurement, “the greatest deference possible is given to the agency.”’” FirstLine Transp. Sec., Inc. v. United States, 100 Fed. Cl. 359 , 396 (2011) (quoting Univ. Research Co. v. United States, 65 Fed. Cl. 500 , 505 (2005) (quoting Gulf Grp., Inc. v. United States, 61 Fed. Cl. at 351)); see also Plasan N. Am., Inc. v. United States, 109 Fed. Cl. 561 , 572, appeal dismissed (Fed. Cir. 2013); Fort Carson Support Servs. v. United States, 71 Fed. Cl. 571 , 598 (2006) (“Evaluation of past performance is ‘within the discretion of the contracting agency and will not be disturbed unless it is unreasonable or inconsistent with the terms of the solicitation or applicable statutes or regulations.’”) (quoting Consol. Eng’g Servs. v. United States, 64 Fed. Cl. 617 , 637 (2005))). Likewise, the court in Seaborn Health Care, Inc. v. United States, wrote: A similar deferential standard applies when the Court is reviewing an agency's assessment of past performance evaluations. Commissioning Solutions Global, LLC v. United States, 97 Fed. Cl. 1 , 9 (2011) (“[I]n cases such as this, when a negotiated procurement is involved and at issue is a performance evaluation, the greatest deference possible is given to the agency—what our Court has called a ‘triple whammy of deference.’”) (quoting Gulf Grp., Inc. v. United States, 61 Fed. Cl. 338 , 351 (2004))); see also Blackwater Lodge & Training Center Inc. v. United States], 86 Fed. Cl. 488 , 493 (2009) (“mere disagreement” with past performance evaluations is insufficient to disturb agency's decision). Seaborn Health Care, Inc. v. United States, 101 Fed. Cl. 42 , 48 (2011). Continuing, the court stated: In evaluating an offeror's past performance, FAR 15.305(a)(2) affords agencies considerable discretion in deciding what data is most relevant. PlanetSpace Inc. v. United States, 92 Fed. Cl. 520 , 539 (2010). “Thus, when evaluating an offeror's past performance, the [contracting officer] ‘may give unequal weight,’ or no weight at all, ‘to different contracts when [the 42  contracting officer] views one as more relevant than another.’” Linc Gov't Servs., LLC v. United States, 96 Fed. Cl. 672 , 718 (2010) (quoting SDS Int'l, Inc. v. United States, 48 Fed. Cl. 759 , 769 (2001)). Seaborn Health Care, Inc. v. United States, 101 Fed. Cl. at 51 (modifications in original); see also Fluor Intercontinental, Inc. v. United States, 147 Fed. Cl. 309 , 329 (2020); Torres Advanced Enter. Sols., LLC v. United States, 133 Fed. Cl. 496 , 531 (2017) (“When a protestor challenges a procuring agency's evaluation of past performance, the court's review is limited to ensuring that the evaluation was reasonable and performed in accordance with the solicitation; in other words, the procuring agency's evaluation is entitled to great deference.”); Vanguard Recovery Assistance v. United States, 101 Fed. Cl. at 787. “The court must especially defer to the agency's technical evaluations, past performance ratings, and other ‘minutiae of the procurement process . . . which involve discretionary determinations of procurement officials.’” J.C.N. Constr., Inc. v. United States, 107 Fed. Cl. 503 , 510 (2012) (quoting E.W. Bliss Co. v. United States, 77 F.3d at 449 ), subsequent determination, 2013 WL 593479 (Fed. Cl. Feb. 15, 2013). A Judge of this court also has determined that, in a negotiated performance, a protestor must overcome a “triple whammy of deference by demonstrating by a preponderance of the evidence that the SSA lacked any rational basis” to assign a given past performance rating. Overstreet Elec. Co., Inc. v. United States, 59 Fed. Cl. 99 , 117 (2003), appeal dismissed, 89 F. App’x 741 (Fed. Cir. 2004) (emphasis in original); see also CGS Adm’rs, LLC v. United States, 110 Fed. Cl. 431 , 450 (2013) (stating that “past performance evaluations in this type of procurement are accorded a ‘triple whammy of deference’” (quoting Overstreet Elec. Co., Inc. v. United States, 59 Fed. Cl. at 117)); Plasan N. Am., Inc. v. United States, 109 Fed. Cl. at 572; Tech Sys., Inc. v. United States, 98 Fed. Cl. 228 , 243 (2011). Despite the foregoing, although highly deferential, the court’s review of an agency’s past performance evaluation is neither an automatic endorsement of the agency’s actions nor tolerant of observable mistakes and each past performance evaluation must be reviewed on a fact-specific basis. As indicated above, in the above captioned protest, for the Past Performance Factor, the Solicitation stated: FACTOR 2 – Past Performance The past performance confidence assessment rating is based on the offeror’s overall record of recency, relevancy, and quality of performance. In addition, for large business concerns, the Government will evaluate past performance to determine the extent to which offeror has attained applicable goals for small business participation under prior contracts that required subcontracting plans. Relevant experience must be demonstrated within the last three years of providing property preservation and inspection services as required in the PWS. Specifically, a review of record of quality of service, personnel, adhering to contract schedule and cost contract, and attainment of subcontracting goals, if applicable. In accordance with FAR 15.305(a)(2), the currency and relevance of the information, source of the information, context of the data, and general trends in contractor’s performance shall be considered. These are combined to establish one 43  performance confidence assessment rating for each offeror. In addition, this assessment of offeror’s performance will contribute to the responsibility determination. (capitalization and emphasis in original).6 Regarding the Past Performance Factor, each proposal was to be evaluated under the following method: 6 Additionally, the instructions to the offerors indicated: The offeror shall submit a list of the last three contracts completed during the past three years or currently being performed that are similar to the solicitation size, scope, and complexity, and that are specifically related to property preservation and inspection services. Work that is of particular relevance to this solicitation and PWS includes, but is not limited to: • Nationwide Property Inspections (REO and Foreclosure Custodial) • Nationwide Property Preservation (REO and Foreclosure Custodial) 44 The USDA’s evaluation of ISN’s past performance in the Proposal Analysis Report states: 3.1.2 PAST PERFORMANCE FACTOR 3.1.2.1 Performance Confidence Assessment - Observations and Conclusions ISN is assigned as Substantial Confidence. Summarily, Offeror provided substantial past performance both for ISN and its major subcontractor [redacted]. The proposal indicated three contracts for past performance, two performed by the prime and one performed by major subcontractor [redacted]. There were no CPARs or PIPRs reported. The team received only one Past Performance Questionnaire for review. The questionnaire from HUD reflected a rating of “Five” (exceeds) in the areas of delivery performance and problem solving and a rating of “four” (meets and occasionally exceeds) in overall quality, quality of service, and quality of personnel (Ref. B20 Performance Evaluation Report). (capitalization and emphasis in original). The Source Selection Decision Document concluded, regarding ISN’s Past Performance: ISN Past Performance Confidence rating of “Substantial” was reviewed and assessed on information reviewed by the TET on three contracts. Two of the contracts ISN was the Prime and with the third contract performed by their major proposed subcontractor, [redacted]. The ISN prime contract values ranged from $22M to 42M, which is comparable in size and scope to this solicitation requirement. There were no CPARs on record. A Past Performance Questionnaire from HUD was received reflecting “Five” (exceeds) in the areas of delivery performance and problem solving and a rating of “four” (meets and occasionally exceeds) in overall quality, quality of service, and quality of personnel. As noted above, protestor MCS alleged that “[t]wo out of three of ISN’s Past Performance examples did not meet the Solicitation’s definition of how offerors would demonstrate relevance,” and, therefore, the agency’s Substantial Confidence rating for ISN’s past performance was unreasonable.7 MCS first cites to the Nationwide Asset Management Services for the United States Marshalls Service (USMS) contract. 7 Regarding the third past performance contract submitted by ISN for the Past Performance Factor, the contract by subcontractor [redacted] Nationwide Asset Management Services for [redacted], MCS conceded that “[u]nder the terms of the Solicitation, the Agency properly considered” the contract to be relevant, but argued that “ISN only proposed that [redacted] perform 30% of the contract work.” (internal references omitted). Additionally, MCS argued it “would be irrational for USDA to find that one out of three relevant contract examples entitled ISN to the highest Past Performance rating.” 45  Regarding the USMS contract, ISN’s proposal stated in part: ISN supported the USMS by delivering an array of asset management services to a revolving portfolio of approximately [redacted] nationwide residential, commercial, and multi-family properties that were in the process of receiving Preliminary Order of Forfeiture (POF) or Final Order of Forfeiture (FOF) status to become REO in the DOJ AFF. ISN provided property maintenance and management services, routine inspections for condition assessment, vendor management, tenant rents and lease administration, data quality assurance, reporting, and much more. Property Management and Maintenance: For this effort, ISN managed a wide range of properties, to include vacant and occupied residential and commercial buildings. ISN performed regular site visits to assess conditions, photograph property, and verify compliance with local code regulations. For properties with tenants, ISN performed lease and rent administration services, eviction proceedings, and the handling of delinquencies in rent. For properties without tenants, our management team worked with an expansive network of vendors to obtain bids and perform all recurring and emergency maintenance services. Staffing: In order to properly staff the USMS contract, ISN utilized existing knowledgeable property management personnel, reallocated personnel, and hired approximately 8 additional staff members. Our teams of professionals worked hand and hand with USMS personnel daily to ensure the properties were properly preserved in order to fast track them for sale. We were able to use our nationwide, readily available field staff to provide personnel to support the management and maintenance of assets within the United States and all U.S. territories. Additionally, ISN demonstrated strong capability to minimize staff augmentation and other expense increases even as the scope of work was expanded throughout the course of the contract. (capitalization and emphasis in original). Regarding the size of the USMS contract, which included a “revolving portfolio of approximately [redacted] nationwide residential, commercial, and multi-family properties,” protestor noted that [b]y contrast, USDA’s portfolio consists of approximately [redacted] properties, a difference in magnitude of over [redacted]%. Similarly, the total contract price for ISN’s USMS contract was $22.5M over six years, or approximately $3.75M per year. Even at ISN’s unrealistically-low pricing [for the Solicitation at issue in the above captioned protest], the present procurement would be approximately [redacted]% greater in annual value than ISN’s USMS contract. (internal reference omitted). 46  The Source Selection Decision Document noted for ISN’s three Past Performance references: “The ISN prime contract values ranged from $22M to 42M, which is comparable in size and scope to this solicitation requirement.” The Source Selection Decision Document did not note, as protestor did, that the $22 million contract for USMS was a 6 year contract, and, therefore, did not explain how it would comparable in size and scope to this solicitation requirement.” Similarly, the Proposal Analysis Report stated, in part: “ISN is assigned as Substantial Confidence. Summarily, Offeror provided substantial past performance both for ISN and its major subcontractor [redacted]. The proposal indicated three contracts for past performance, two performed by the prime and one performed by major subcontractor [redacted]. There were no CPARs or PIPRs reported. The team received only one Past Performance Questionnaire for review.” The court notes that the Past Performance Questionnaire was not for the USMS contract, but for the United States Department of Housing and Urban Development contract discussed below. It is unclear how the Proposal Analysis Report could have determined that ISN could meet the requirements of the Solicitation based on the USMS contract, much less reach that conclusion with substantial confidence, which required that “the Government has a high expectation that the offeror will successfully perform the required effort.” Intervenor responded that the “USDA acted within its (considerable) discretion in evaluating this effort, and stated: Under this [USMS] contract, ISN delivered “an array of asset management services to a revolving portfolio of approximately [redacted] nationwide residential, commercia, and multi-family properties” that were in the process of becoming REO assets. AR 409. This included “property maintenance and management services, routine inspections for condition assessment, vendor management, tenant rents and lease administration, data quality assurance, reporting, and much more.” Id. These services were performed “in all 50 U.S. States and its Territories,” and specifically involved “performing weekly, biweekly, and monthly property inspections with photographs; . . . completing emergency repairs; . . . inspecting, reporting, and abating/remediating environmental hazards;” and more. AR 413. Moreover, as part of this effort, ISN “developed a network of approximately [redacted] geographically dispersed inspectors to deliver high quality, timely property inspections.” Id. Considering the totality of this effort—and ISN’s high performance marks under it (AR 413–14)—USDA considered this project as part of its Substantial Confidence past performance score. (capitalization, emphasis and alterations in original). Intervenor, however, only quoted its own proposal, and aside from highlighting the deference owed the agency, does not attempt to explain how the agency determined the “Substantial Confidence” rating was warranted. Defendant argued that MCS highlights the “difference” between the USMS contract and the USDA contract, by contraposing the quantity of properties serviced under each contract. MCS contends that, under the USMS contract, the portfolio is 47  [redacted] properties whereas the current USDA contact requires service of [redacted] properties. Thus, MCS suggests that ISN did not fulfill the past performance requirement. MCS’s argument has no merit. (internal references omitted). Furthermore, defendant reasoned “the solicitation does not identify or define what constitutes ‘similar in size, scope, and complexity,’ and, thus, that determination is left to the broad discretion of the agency.” Like intervenor, defendant does not rely on any documented rationale of the agency, or offer an explanation for why the difference in scope and price for the USMS contract would warrant a strong past performance evaluation. Defendant simply defaults to the deference to the agency argument. Although agency decisions are entitled to deference under APA review, see also Glenn Def. Marine (ASIA), PTE Ltd. v. United States, 720 F.3d at 911 (citing E.W. Bliss Co. v. United States, 77 F.3d at 449 ), the deference is not absolute, and courts will reject an agency’s determinations if they are unreasonable. See SP Sys., Inc. v. United States, 86 Fed. Cl. at 23. The court finds that with respect to the Past Performance evaluation for the USMS contract, the agency’s determination was unreasonable. The agency provided no explanation for why the USMS contract met the past performance requirements, did not attempt to justify the difference in the size and scope of the contract, or explain why a past performance questionnaire was not obtained for the USMS reference. Given the difference, in the size and scope for the USMS contract versus the anticipated contract to be award under the Solicitation, it was incumbent on the agency to document some rationale for giving ISN the highest past performance rating. As noted above, only MCS and ISN were given Technical Factor ratings of Outstanding and Past Performance ratings of Substantial Confidence. As the Solicitation explained in the “Relative Importance of Factors:” The award resulting from this solicitation will be made based on the best overall proposal that is determined to be the most beneficial to the Government (i.e., best value tradeoff process). The Technical Capability Factor is slightly more important than the Past Performance Factor. Technical Capability Subfactors, 1.1, 1.2, 1.3, 1.4 and 1.5, are rated in descending order of importance. Overall, Non-Price Factors, when combined, are significantly more important than Price. Price is not an adjectivally rated Factor; however, the Price Factor will become the more dominant factor as technical proposals reach technical equality. Had ISN not received a Substantial Confidence rating like MCS, the agency may have determined MCS was entitled to contract award. Given the requirement, the paucity of information about the USMS contract in the agency’s evaluations is glaring. MCS also questions a second contract that ISN included for its past performance, Mortgagee Compliance Management for the United States Department of Housing and Urban Development (HUD). As indicated in the Administrative Record, as Mortgagee Compliance Manager ISN is responsible for assigned Mortgagee Compliance Manager functions including: • [redacted] 48  • [redacted] • [redacted] • [redacted] • [redacted] • [redacted] • [redacted] • [redacted] MCS notes that for Past Performance submissions, the Solicitation required “[r]elevant experience must be demonstrated within the last three years of providing property preservation and inspection services as required in the PWS.” Protestor argued that “ISN provided financial and title-related services to HUD, while MCS and other field service organizations performed the property preservation work,” and “[b]ecause ISN’s HUD contract did not involve ‘providing property preservation and inspection services’ for any period of time, it is not relevant under the terms of the Solicitation.” Regarding the HUD contract, defendant argued: “[A]s noted by the agency, the HUD contract involved providing services in rural and remote areas (similar to USDA’s contract), AR 1586, performance involved servicing [redacted] properties per year (exceeding USDA’s contract), AR 1586, and performance involved pre and post foreclosure services (similar to USDA’s contract), AR 1586.” The court notes, however, all three of defendant’s citations are to the exhibits at the GAO. Moreover, the exhibits defendant refers to are from the past performance evaluation of the HUD contract prior to the corrective action, and not to the one currently before the court. Similarly, intervenor, citing to its proposal in the Administrative Record, argued the HUD contract involved “pre- and post-foreclosure services to approximately [redacted] properties per year,” including “processing property preservation requests on behalf of HUD; reviewing property inspections conducted on defaulted single family (SF) FHA properties; submitting contingency preservation requests to the COR for emergency repairs or environmental hazard abatement; providing daily, weekly, and monthly reporting on property volume, revenue recovery/expenditures, and contract performance.” Additionally, intervenor argued that “though USDA recognized that this work did not involve actually performing the services, it did ‘indicate[] experience with pre- and post- foreclosure services, and detailed support that [redacted].” The court notes, however, like with defendant’s argument, the agency’s past performance evaluation of the HUD contract is from the first evaluation, prior to the corrective action. It does not appear again in the agency’s evaluation after the corrective action. Moreover, ISN left out an important part of the evaluation in its quotation. The sentence ISN quoted states in full: “The team noted that past performance record number two supporting HUD which indicated experience with pre- and post-foreclosure services, [redacted] as opposed to performing the services.” (emphasis added) Moreover, the intervenor does not contradict protestor’s claim that “ISN provided financial and title-related services to HUD, while MCS and other 49 field service organizations performed the property preservation work,” and admits that the USDA “recognized that this work did not involve actually performing the services.” ISN’s work for the HUD contract appears to be substantially different than the work ISN would be expected to perform for the USDA, and raises questions as to why the HUD contract would warrant a past performance rating of Substantial Confidence from the agency’s evaluation of ISN’s proposal. As noted above, regarding ISN’s past performance, the agency in the Proposal Analysis Report indicated: ISN is assigned as Substantial Confidence. Summarily, Offeror provided substantial past performance both for ISN and its major subcontractor [redacted]. The proposal indicated three contracts for past performance, two performed by the prime and one performed by major subcontractor [redacted]. There were no CPARs or PIPRs reported. The team received only one Past Performance Questionnaire for review. The questionnaire from HUD reflected a rating of “Five” (exceeds) in the areas of delivery performance and problem solving and a rating of “four” (meets and occasionally exceeds) in overall quality, quality of service, and quality of personnel (Ref. B20 Performance Evaluation Report). (capitalization and emphasis in original). The Source Selection Decision Document concluded, regarding ISN’s Past Performance: ISN Past Performance Confidence rating of “Substantial” was reviewed and assessed on information reviewed by the TET on three contracts. Two of the contracts ISN was the Prime and with the third contract performed by their major proposed subcontractor, [redacted]. The ISN prime contract values ranged from $22M to 42M, which is comparable in size and scope to this solicitation requirement. There were no CPARs on record. A Past Performance Questionnaire from HUD was received reflecting “Five” (exceeds) in the areas of delivery performance and problem solving and a rating of “four” (meets and occasionally exceeds) in overall quality, quality of service, and quality of personnel. (capitalization in original).8 The agency provides no insight for why the HUD contract warranted the strong past performance reference. Moreover, the USDA did not explain 8The court notes, in the original evaluation by the agency before the corrective action, which the defendant and intervenor cite to, the USDA determined with regard to ISN’s past performance: ISN provided past performance information on three contracts, two performed by the prime and one performed by major subcontractor [redacted]. The first record, performed by ISN, cited a contract value of approximately $22M and supported the USMS by delivering asset management services to a revolving portfolio of approximately [redacted] 50 why the HUD contract met the requirements of “[r]elevant experience must be demonstrated within the last three years of providing property preservation and inspection services as required in the PWS.” The agency did not even describe if the HUD contract had involved performance of “preservation and inspection services.” Instead, the agency simply stated that ISN’s HUD contract had a strong reference with its Past Performance Questionnaire. In its brief, protestor argued that “[t]his case is similar to FFL Pro LLC, 124 Fed. Cl. 536 , 555 (2015), in which the Court set aside an agency’s past performance evaluation,” and the court agrees. In FFL Pro LLC v. United States, the United States Department of State's Office of Antiterrorism Assistance (ATA) issued a solicitation for the acquisition of overseas cyber security training services and supplies. See id. at 539. In FFL Pro LLC, a Judge of the United States Court of Federal Claims explained that “proposals would be evaluated according to five factors; in descending order of importance, these factors were: (1) Technical Compliance With all of the Terms and Conditions of the Solicitation (‘Technical Compliance’); (2) Corporate Experience; (3) Past Performance; (4) Status of Property Management; and (5) Price.” Id. at 540 (footnote omitted). Regarding Past Performance, the solicitation in In FFL Pro LLC stated that: Offerors are advised to use references from projects involving relevant IT supplies and IT training services within the scope of this solicitation and in compliance with [Federal Acquisition Regulation (“FAR”) ] 52.212–1. (i) Provide a description of the offeror's experience in the professional information technology services and cyber training services industries referenced in the [request for proposals]. Describe three completed or on- going project(s), similar in size and complexity to the effort contemplated herein and in sufficient detail for the Government to perform an evaluation. nationwide residential, commercial, and multi-family properties (occupied and vacant). The second record, performed by ISN, cited an awarded value of $42M over the period 06/01/2015 to 5/31/2020 and supports the current Department of Housing and Urban Development (HUD) National Servicing Center’s (NSC’s) Mortgagee Compliance Manager (MCM). The third record, performed by [redacted], cited a contract value of $425M from 08/2009 to present. This effort provides nationwide Real Estate Owned (REO) asset management, title services, field services, valuations, brokerage, online marketing, and settlement services in support of [redacted]. The team noted that past performance record number two supporting HUD which indicated experience with pre- and post-foreclosure services, [redacted] as opposed to performing the services. There were no CPARs or PIPRs reported. The team received only one Past Performance Questionnaire for review. The questionnaire from HUD reflected a rating of “Five” (exceeds) in the areas of delivery performance and problem solving and a rating of “four” (meets and occasionally exceeds) in overall quality, quality of service, and quality of personnel. 51 FFL Pro LLC v. United States, 124 Fed. Cl. at 541 (brackets in original). Awardee VariQ Corporation (VariQ) was awarded an “Exceptional” past performance rating, and protestor FFL Pro LLC challenged the past performance rating, among other claims at the Court of Federal Claims. See id. at 546. The Judge in FFL Pro LLC recognized that the “evaluation and rating of proposals is within the discretion of the procuring agency,” but in the FFL Pro LLC case, the Technical Evaluation Team's evaluation of VariQ's past performance— twice endorsed by the contracting officer—does not meet these standards because it does not address any of the criteria set forth in the Past Performance factor description; in other words, it does not evince a consideration of relevant factors. Indeed, the narrative summary provided by the Technical Evaluation Team in support of its exceptional rating is little more than a copy-and-paste of the solicitation’s definition of “exceptional.” FFL Pro LLC v. United States, 124 Fed. Cl. 536 , 555–56 (2015) (footnote omitted). Therefore, the Judge concluded “[i]n the absence of a coherent and reasonable explanation from the ATA of its evaluation of VariQ's proposal under the Past Performance factor, the court cannot ascertain whether the ATA's evaluation had a rational basis.” Id. at 557 (footnote omitted). Similarly in the above captioned protest, the court cannot determine how the agency determined the HUD contract warranted a past performance rating of Substantial Confidence, or how the agency even determined that the work performed by ISN was in line with the requirements for performance of the contract to be award by the USDA. Despite the great deference afforded the agency for its past performance evaluations, see Todd Constr., L.P. v. United States, 88 Fed. Cl. 247 ; Vanguard Recovery Assistance v. United States, 101 Fed. Cl. at 785, given the USDA’s minimal explanation of how the agency evaluated ISN’s HUD past performance, the court finds the agency’s conclusion was not reasonable. Having found that the USDA’s evaluations of two of ISN’s three past performance references were not reasonable, and not performed in accordance within the requirements of the Solicitation, the agency’s decision to award ISN a past performance rating of Substantial Confidence rating, the highest possible rating and the rating which requires the agency to determine that based on the relevant performance record, “the Government has a high expectation that the offeror will successfully perform the required effort,” the agency acted unreasonably, see Torres Advanced Enter. Sols., LLC v. United States, 133 Fed. Cl. at 531, and the agency’s past performance evaluation of ISN, therefore, was arbitrary and capricious. The court notes that the GAO reached the opposite conclusion about the USDA’s past performance evaluation. As noted above, the GAO determined: While the protester notes aspects of two of ISN's contracts that were dissimilar to the instant effort, the evaluation record demonstrates that ISN's overall past performance and experience supports the agency's assigned ratings. In this respect, ISN submitted two contract references involving 52  property management services, including a contract performed by ISN's subcontractor with a value of $425 million. The third contract, the HUD contract, involved the provision of portfolio management services for approximately 60,000 properties per year. While such services were merely “related to” property preservation and inspection services, we find that the agency nonetheless acted reasonably in considering the HUD contract as part of ISN's overall past performance and relevant experience. In sum, we find that the agency reasonably found that ISN's overall experience and past performance were relevant and merited the high ratings assigned to ISN under those factors. Id. at *8 (internal references omitted). With respect to the GAO,9 the GAO’s conclusions regarding ISN’s past performance appear summary, and did not fully address the differences in the size and scope of ISN’s past performance references. Most notably, with regard to the HUD contract, the GAO indicated the services performed were “merely ‘related to’ property preservation and inspection services,” the GAO found “that the agency nonetheless acted reasonably in considering the HUD contract as part of ISN's overall past performance and relevant experience.” Id. As the solicitation at issue was for property preservation and inspection services for USDA’s rural property portfolio the GAO’s decision does not reflect sufficient analysis of the reasonableness by the agency to find the HUD contract warranted a Past Performance rating of “Substantial Confidence.” As the USDA’s evaluations of two of ISN’s past performance references were not reasonable, this calls into question the agency’s evaluation of the Technical Factor’s first sub-factor. As noted above, for the Technical Factor, the Solicitation stated: FACTOR 1 – Technical Capability – Overall the Technical Capability will be evaluated based on the extent to which it is demonstrated a likelihood of successful performance of the requirements of the Performance Work Statement (PWS) (Attachment A). The effectiveness and feasibility of the proposed Technical Capability and the offerors understanding of the work will be considered as part of the assessing the likelihood of successful performance. (capitalization and emphasis in original). The Solicitation explained that [t]here are five technical capability subfactors that will be evaluated and considered in descending order of importance as follows and evaluated based on: 9 Although Judges of the United States Court of Federal Claims, including the undersigned, have high respect for the expertise of the GAO, and often consider the reasoning included in GAO decisions when reaching their own opinions, GAO decisions are not binding on the United States Court of Federal Claims. See Cleveland Assets, LLC v. United States, 132 Fed. Cl. 264 , 280 n.15 (2017); see also Centech Grp., Inc. v. United States, 554 F.3d at 1038. 53  Sub-factor 1.1 - Relevant Experience - Demonstration of experience in providing services to assist USDA, RD in providing a variety of property/asset management services associated with pre and post liquidation of SFH rural properties serving as security for rural housing loans and guarantees of equivalent portfolio size, as specifically listed in the PWS. (capitalization and emphasis in original). Therefore, the Technical Factor’s first sub-factor was considered the most important technical sub-factor. The requirement required the “[d]emonstration of experience in providing services to assist USDA,” however, as determined above, the experience provided by ISN in its proposal was not sufficient to demonstrate ISN had performed similar work to the work required by the agency for successful performance of the contract. The agency should have more carefully considered whether ISN’s insufficient past performance references warranted an overall Technical rating of Outstanding, which requires that the “[p]roposal indicates an exceptional approach and understanding of the requirements and contains multiple strengths, and risk of unsuccessful performance is low.” Price Additionally, protestor alleged that the “USDA failed to properly evaluate ISN’s unrealistically low pricing,” and claimed that the “Agency performed an irrational price realism evaluation of ISN.” In response, defendant argued that the “USDA’s price realism analysis was reasonable and in accordance with the Solicitation.” Similarly, ISN claimed the “USDA’s thorough price realism evaluation should be upheld.” A price realism analysis considers whether an offeror’s price is too low, such that it indicates a risk of poor performance and a lack of understanding of the solicitation requirements. See KWR Constr., Inc. v. United States, 124 Fed. Cl. 345 , 356 (2015) (“Generally, a price realism analysis examines the performance risk of proposals in a fixed-price contract procurement, with particular attention to the risk of low-priced proposals. . . .”) (internal citations removed). A price realism analysis differs from a price reasonableness analysis because a price reasonableness analysis considers whether an offeror’s price is too high.10 See Munilla Constr. Mgmt., LLC v. United States, 130 Fed. Cl. 635 , 649 (2017) (explaining that an agency’s concern in making a price reasonableness determination is whether the prices are too high, and a “determination of whether an offeror’s prices are too low is made when an agency conducts a cost or price realism analysis”); see also EMTA Isaat, A.S. v. United States, 123 Fed. Cl. 330 , 338 n.9 (2015) (“In general, a price reasonableness analysis has the goal of preventing the government from paying too much for contract work. A price realism analysis, on the other hand, investigates whether the contractor is proposing a price so low that performance of the contract will be threatened.”). Price realism is not defined in the Federal Acquisition 10 FAR 15.404-1(a) requires a price reasonableness evaluation and provides that the “contracting officer is responsible for evaluating the reasonableness of the offered prices” in a negotiated procurement. 48 C.F.R. § 15.404-1 (a)(1) (2019). The parties do not dispute that the agency considered price reasonableness. 54 Regulation (FAR). See Mil-Mar Century Corp. v. United States, 111 Fed. Cl. 508 , 541 n.36 (2013); DMS All-Star Joint Venture v. United States, 90 Fed. Cl. at 663 n.11 (quoting Ralph C. Nash & John Cibinic, Price Realism Analysis: A Tricky Issue, 12 No. 7 Nash & Cibinic Rep. ¶ 40 (July 1988) (citing 48 C.F.R. § 15.404 –1(d)(1), (3)) (“A price realism analysis ‘is analysis to determine if the offeror’s proposed prices are unrealistically low.’”).11 The Federal Circuit has explained that Judges of this court should determine “whether the agency's price-realism analysis was consistent with the evaluation criteria set forth in the RFP, see Galen Med. Assocs., Inc. v. United States, 369 F.3d 1324 , 1330 (Fed. Cir. 2004), not to introduce new requirements outside the scope of the RFP.” See Alabama Aircraft Indus., Inc.-Birmingham v. United States, 586 F.3d at 1375–76 (emphasis in original). The Federal Circuit in Agile Defense, Inc. v. United States, also indicated, albeit with regard to cost realism: The regular view of the Court of Federal Claims, which we approve, is that contracting agencies enjoy wide latitude in conducting the cost realism analysis. See, e.g., Mission1st Grp., Inc. v. United States, 144 Fed. Cl. 200 , 211 (2019) (“It is well established that contracting agencies have broad discretion regarding the nature and extent of a cost realism analysis, unless the agency commits itself to a particular methodology in a solicitation.” (citation and internal quotation marks omitted)); Dellew Corp. v. United States, 128 Fed. Cl. 187 , 194 (2016) (“The Agency has demonstrated that it considered the information available and did not make irrational assumptions or critical miscalculations. To require more would be infringing on the Agency’s discretion in analyzing proposals for cost realism.” (citation and internal quotation marks omitted)); United Payors & United Providers Health Servs., Inc. v. United States, 55 Fed. Cl. 323 , 329 (2003) (emphasizing that the procuring “agency is in the best position to make [the] cost realism determination” (citation and internal quotation marks omitted)). Agile Def., Inc. v. United States, 959 F.3d 1379 , 1385–86 (Fed. Cir. 2020); see also Afghan Am. Army Servs. Corp. v. United States, 90 Fed. Cl. 341 , 358 (2009) (“The nature and extent of a price realism analysis is ultimately within the sound exercise of the agency's discretion, unless the agency commits itself to a particular methodology in a solicitation.”). Judges of this court have found that, in a fixed-price procurement, an agency is required to perform a price realism analysis when the solicitation expressly provides that 11 Unlike price realism, FAR 15.404-1(d) defines a cost realism analysis as “the process of independently reviewing and evaluating specific elements of each offeror's proposed cost estimate to determine whether the estimated proposed cost elements are realistic for the work to be performed; reflect a clear understanding of the requirements; and are consistent with the unique methods of performance and materials described in the offeror's technical proposal.” 48 C.F.R. § 15.404-1 (d)(1). 55 the agency will evaluate price realism or states that “[t]he Government may reject any proposal that is . . . unreasonably high or low in price when compared to Government estimates, such that the proposal is deemed to reflect an inherent lack of competence of [sic] failure to comprehend the complexity and risks of the program.” ViON Corp. v. United States, 122 Fed. Cl. 559 , 573 (2015) (emphasis removed) (finding that such language commits the agency to conducting a price realism analysis); see also EMTA Isaat, A.S. v. United States, 123 Fed. Cl. at 338 (explaining that there “is no dispute that the plain language of the RFP required the government to conduct a price realism analysis” when the solicitation provided that “[a]ll offerors[’] proposed prices will be evaluated to ensure they are realistic, reasonable, and complete”); D & S Consultants, Inc. v. United States, 101 Fed. Cl. at 33 (explaining that the parties agreed that the solicitation required a price realism analysis because it stated “[t]he Government may evaluate the offeror's proposed labor rates to determine if the proposed rates are unrealistically low in order to assess the ability of the offeror to meet the PWS requirements and whether the proposal provides the Government with a high level of confidence of successful performance”). In Afghan American Army Services Corp. v. United States, another Judge on this court determined that an agency was required to conduct a price realism evaluation because the solicitation stated that the agency would “evaluate price proposals to determine whether the offered price reflects a sufficient understanding of the contract requirements and the risk inherent in the offeror's approach” and that proposals with “an unreasonable (high or low) price may be deemed to be unacceptable and may not receive further consideration.” Afghan Am. Army Servs. Corp. v. United States, 90 Fed. Cl. at 357 Similarly, in Rotech Healthcare, Inc. v. United States, the court concluded that a price realism analysis was required because the solicitation stated that an “unrealistically low price may be grounds for eliminating a proposal.” Rotech Healthcare, Inc. v. United States, 121 Fed. Cl. 387 , 404 (2015) (explaining that “the only reason any consideration of realism is necessary is the language in the RFP stating that unrealistically low offers may be eliminated”). Regarding price, the Solicitation stated: Price analysis is a process of examining and analyzing a proposed price without evaluating separate cost elements and proposed profit/fee to ensure that the proposed price is fair and reasonable. The CO may use the following techniques in performing price analysis: (a) Comparison of proposed prices received in response to the Solicitation; (b) Comparison of previously proposed prices and contract prices with current proposed prices for the same or similar services (labor categories) in comparable quantities; and, (c) Comparison of proposed prices with independent cost estimates. Specifically regarding a price realism analysis, the Solicitation indicated: The purpose of realism analysis is to ensure that proposed prices are not so low such that contract performance is put at risk from either a technical and/or cost perspective. It is separate from analyses performed to determine price reasonableness. Realism analysis determines whether an offeror’s proposed costs and/or prices: 56  (a) Are realistic for the work to be performed; (b) Reflect a clear understanding of the requirements; and (c) Are consistent with the various elements of the offeror's technical proposal. Price Realism analysis is an objective process that focuses on the proposed price and performance risks. Price realism is used when requirements may not be fully understood by the offeror, there are quality concerns, past experience indicates that contractors’ proposed prices have resulted in quality of service shortfalls. Results of the analysis may be used in performance risk assessments and responsibility determinations. The Solicitation, therefore, required a price realism analysis, but did not specify how the agency was to evaluate price realism, or mandate any specific approach. Regarding ISN’s price proposal, the Proposal Analysis Report included the following chart and discussion: COMPETITIVE PRICE CHART ISN [redacted] [redacted] [redacted] MCS [redacted] [redacted] CLIN 001 TOTAL IDIQ 18 $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] CLIN 001 TOTAL TASK $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] ORDER CLIN 002 TOTAL IDIQ 18 $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] CLIN 002 TOTAL TASK $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] ORDER BOTH CLINS TOTAL IDIQ $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] 18 BOTH CLINS TOTAL TASK $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] $[redacted] ORDER 12 MONTH CLIN 001 Inspections - Pricing is below the CPR, and comparable to CLIN 001 pricing for MCS, [redacted] and [redacted]. Therefore CLIN 001 is found fair and reasonable. CLIN 002 Property Preservation Services - The individual service items on the price list are lower than the CPR and is competitive with prices received as shown in the chart above. The Offeror indicated in their Vol 3 Price Proposal, that their pricing was “well researched, and was 100 percent compliant, based on existing rates, other Government work similar in nature, numerous independent surveys and market data which lower staffing in their approach.” Further justification for pricing is that the offeror indicated through a clarification that they are aware this requirement is for rural America and that their pricing reflects that fact. Therefore, their price is found realistic and in conformity with their proposed technical approach. 57  The offerors combined CLIN 001 and 002 price is competitive with other offered prices, and in accordance with evaluation criteria set forth in section M paragraph 4., “the Price Factor will become the more dominant factor as technical proposals reach technical equality. In such cases, where all non- priced factors being evaluated are virtually the same, best value may be represented by the lowest-priced proposal.” ISN tied MCS in their technical rating with an “outstanding” but had an overall lower price. ISN is found to be fair and reasonable and has been determined to be the best value with an outstanding technical rating and lowest price out of the two offerors whom received an outstanding rating*Competition Price Results (Ref. B19 Price Proposal Evaluation-Price Competition Memo). (capitalization and emphasis in original). With regard to ISN’s pricing, the agency’s Price Competition Memo stated: CLIN 001 Inspections - Pricing is in line with the CPR, and comparable to CLIN 001 pricing for MCS, [redacted] and [redacted]. Therefore CLIN 001 is found fair and reasonable. CLIN 002 Property Preservation Services - The individual service items on the price list are lower than the CPR, however, are competitive with prices received as shown in the chart above. The Offeror indicated in their Vol 3 Price Proposal, that their pricing was “well researched, and was 100 percent compliant, based on existing rates, other Government work similar in nature, numerous independent surveys and market data which lower staffing in their approach.” Further justification for pricing is that the offeror indicated through a clarification that they are aware this requirement is for rural America and that their pricing reflects that fact. The offerors combined CLIN 001 and 002 price is competitive with other offered prices, and in accordance with evaluation criteria set forth in section M paragraph 4., “the Price Factor will become the more dominant factor as technical proposals reach technical equality. In such cases, where all non- priced factors being evaluated are virtually the same, best value may be represented by the lowest-priced proposal.” ISN tied MCS in their technical rating with an “outstanding” but had an overall lower price. ISN pricing at $[redacted] for Task Order 1; and, IDIQ 18-month ceiling of $$34,983,380.00 is found to be fair and reasonable. Their pricing is also determined to be realistic in accordance with their technical approach and understanding of the work, as demonstrated in their “outstanding” technically rated proposal and through clarification, as stated above. 58 (capitalization in original). Regarding ISN’s price, the Source Selection Decision Document stated: Overall pricing for the Task Order 1 of $[redacted], is aligned with the CPR, and other comparatively priced offerors submitted in response to this solicitation requirement. Further, pricing for some of the individual service items appear to be aligned with the corrective action Attachment 2, Unit Price Analysis, which was an average of other agency’s public price lists. Therefore, their pricing was deemed fair, reasonable, realistic and balanced for the work under this requirement with the unique feature different from other property preservation contracts in that in the commercial market this work is most often in rural areas that are oftentimes difficult to reach. The justification for the price realism analysis came from the conclusion, referred to in both the Proposal Analysis Report and the Price Competition Memo, that ISN’s prices were “lower than the CPR,” competitive with other offerors, and ISN “indicated in their Vol 3 Price Proposal, that their pricing was ‘well researched, and was 100 percent compliant, based on existing rates, other Government work similar in nature, numerous independent surveys and market data which lower staffing in their approach.’” Protestor argued that the “USDA’s quantitative ‘analysis’ in support of these conclusions consisted of a few spreadsheets with columns simply listing side-by-side the pricing values for each offeror, the IGCE [Independent Government Cost Estimate], the CPR, and the AAP.” (brackets added). ISN argued, however, that the “USDA’s thorough price realism evaluation should be upheld,” and defendant takes issue with MCS’ characterization of the agency’s analysis, noting that “MCS states that the agency’s entire determination was limited to a single ‘conclusory statement’ supported by an excel spreadsheet.” According to ISN, “MCS’s argument is factually incorrect and legally unsound,” arguing that “the agency’s assessment of ISN’s price was comprehensive. The technical evaluation team, pricing evaluation team, contracting officer, and Source Selection Authority reviewed and assessed ISN’s pricing proposal.” (internal references omitted). Defendant also claims that protestor’s argument that each progressive level of review merely “parroted” the prior review, is wrong. Each level of review culminated in a narrative analysis that recited the record evidence demonstrating that ISN’s pricing proposal was realistic. That the evidence did not change over the course of the pricing realism analysis and that the multiple assessors found the same evidence persuasive does not reflect an insufficient assessment; the agreement amongst the assessors bolsters, rather than detracts from, the determination that ISN’s prices were realistic. (internal references omitted). Defendant’s arguments notwithstanding, the court is not clear why the agency believed ISN’s prices to have been realistic. The agency’s clearest statement on ISN’s price is: 59  CLIN 001 Inspections - Pricing is in line with the CPR, and comparable to CLIN 001 pricing for MCS, [redacted] and [redacted]. Therefore CLIN 001 is found fair and reasonable. CLIN 002 Property Preservation Services - The individual service items on the price list are lower than the CPR, however, are competitive with prices received as shown in the chart above. The Offeror indicated in their Vol 3 Price Proposal, that their pricing was “well researched, and was 100 percent compliant, based on existing rates, other Government work similar in nature, numerous independent surveys and market data which lower staffing in their approach.” Further justification for pricing is that the offeror indicated through a clarification that they are aware this requirement is for rural America and that their pricing reflects that fact. (capitalization in original). The agency’s simple statement that the prices are in line with the CPR alone does not merit a finding that the price realism analysis is sufficient. Although the evaluations included various charts, the charts are not given any context by the agency. Likewise, the agency’s reliance on ISN’s own statement that their pricing was “well researched, and was 100 percent compliant, based on existing rates, other Government work similar in nature, numerous independent surveys and market data which lower staffing in their approach,” does not alone merit a determination that the agency performed an adequate price realism analysis. Similarly, insufficient is the intervenor’s acknowledgment that ISN is “aware this requirement is for rural America and that their pricing reflects that fact” cannot alone demonstrate that ISN’s prices were realistic. In sum, the agency’s own evaluations do not reflect why the USDA found ISN’s prices were realistic. Protestor also claimed that ISN’s combined CLIN 001 and 002 price for Task Order 1 was lower than the IGCE by over [redacted] percent, lower than the CPR by over [redacted] percent, lower than the next highest offeror by over [redacted] percent, and lower than the Agency’s own revised AAP by over [redacted] percent. Any meaningful analysis – regardless of the method used – would have flagged ISN’s proposal as being unrealistically low, or at the very least prompted further inquiry and evaluation of potential risks. (capitalization and emphasis in original). Protestor also argued that “the lowest of the technically acceptable and reasonably priced offers (i.e., those included in the CPR) also belonged to the awardee, but ISN’s IDIQ and Task Order ceiling bids were nearly [redacted] percent below the highest price proposal in the CPR.” (capitalization and emphasis in original). ISN somewhat confusingly responded that “the evaluation confirmed that a low price was not, in and of itself, a basis to not award a contract to an offeror; indeed, the Solicitation encouraged low pricing, noting that ‘where all non-priced factors being evaluated are virtually the same, best value may be represented by the lowest-priced proposal.” (emphasis in original). Furthermore, intervenor argued that “[t]his 60 cherry-picked data point [that ISN’s ceiling bids were nearly [redacted]% below the highest price proposal] does not, however, show that ISN’s price was unrealistically low.” The pricing analysis by the agency consisted of the CPR, which “established average prices for CLINs 001 and 002, both for an 18-month and 12-month (task order) period, using only the proposals rated Acceptable and better,”12 and the Averaged Agency Pricing (AAP). The agency explained that, after the corrective action: A comparison price chart was created in order to compare the pricing of individual service items against the Offeror’s price proposals. Also, for this corrective action, we had the RD Price Estimator, put together an estimate of pricing for individual service line items. The estimate was based on pricing from publicly available price lists of other agencies with similar requirement, namely, HUD, VA, Fannie Mae, and Freddie Mac, hereafter, “Averaged Agency Pricing” (AAP). Under the AAP, Attachment 2, the IDIQ ceiling price is $33,717,020.00 (CPR $43,242,629.00) and the Task Order 1 ceiling is $23,530,544.00 (CPR $28,794,738.00). The agency concluded: “Therefore, what is demonstrated that [sic] even though certain services items are comparable to the pricing submitted by a number of the Offerors, predominately, the AAP’s service item prices are lower than the comparative CPR service item prices. Note, however, this information is for reference only and is not incorporated in the writeup for this report.” This statement, “this information is for reference only and is not incorporated in the writeup for this report,” is unclear as to its meaning or its use in the evaluations. Unstated in the above, or in the evaluation documents, was why the agency determined there was a need to create another price comparison tool, why there was a difference between the two benchmarks of the CPR and the AAP, where the difference came from, and why the differences were significant. Based on the information in the Administrative Record, the CPR for the Task Order 1 ceiling was $28,794,738.00, and the AAP for the Task Order 1 ceiling was $23,530,544.00, a difference of $5,264,194.00. For the ceiling for the entire requirement, the CPR was calculated at $43,242,629.00, and the AAP was calculated at $33,717,020.00, a difference of $9,525,609.00. Despite the large disparity between the CPR and the AAP, the agency did not explain which was a better assessment of the offeror’s prices, and why either the CPR or the AAP would better evaluate if the offeror’s prices were realistic. Although intervenor stated “[t]he AAP was well researched, AR 917–943, and, moreover, helped to confirm the agency’s analysis. AR 921. USDA’s consideration of this information was 12 The agency’s evaluation documents further refer to the IGCE, but without any explanation or context for how the price proposals relate to IGCE. The Administrative Record included internal USDA emails which indicated that IGCE was “based on avg. cost(s) from HUD, VA, Fannie Mae and Freddie Mac,” but neither the emails nor the agency’s evaluation documents explained if the IGCE was used as a metric for price realism. 61 appropriate,” the Administrative Record at those citations do not support ISN’s arguments.13 Furthermore, as protestor argued, it is unclear from what specific sources the Agency gathered the data included in the AAP backup or if USDA took any steps to verify their reliability and currency. The Agency cost estimator merely asserted without further explanation that the AAP “is based on [average] cost(s) from HUD, VA, Fannie Mae and Freddie Mac,” and the Contracting Officer stated post- hoc that “[t]he pricing Estimator found the agencies price lists on their respective websites and through Google searches.” But the record is silent, for example, as to the effectivity or validity dates of the pricing obtained. (internal reference omitted). Moreover, because the agency did not articulate whether the AAP evaluated prices or the CPR evaluated prices were more realistic for the services in the Solicitation, or if the same benchmarks should be applied to both the first task order and the entire contract, the court remains uncertain how the agency determined whether ISN’s pricing, which was similar to the AAP and lower than the CPR was realistic, or the methodology used by the USDA to reach that conclusion. Both defendant and intervenor accuse protestor of asking the court to conduct its own price realism analysis, as intervenor states, “MCS asks the Court to conduct its own price realism evaluation (or, better yet, to simply latch onto MCS’s analysis),” (footnote omitted), and defendant states that “MCS’s invitation to the Court to rewrite the solicitation and require USDA to assess the range that the proposals fall within, and provide certain calculations, analyses, or assessments, is inappropriate and far beyond the scope of judicial review.” (internal references omitted). Further both defendant and intervenor argue that “the unstated premise of MCS’s argument is that it wished USDA had utilized a different methodology to assess pricing realism.” As noted above, “the nature and extent of a price realism analysis is ultimately within the sound exercise of the agency's discretion, unless the agency commits itself to a particular methodology in a solicitation.” Afghan Am. Army Servs. Corp. v. United States, 90 Fed. Cl. at 358. Additionally, the Judge in Afghan American Army explained, “[t]he agency's ‘discretion is even more pronounced when the Solicitation is silent regarding the methodology to be used in conducting a “price realism analysis,”’” as was the case with the Solicitation in the above captioned protest. Afghan Am. Army Servs. Corp. v. United States, 90 Fed. Cl. at 358 (quoting Info. Scis. Corp. v. United States, 73 Fed. Cl. 70 , 101 (2006), recons. in part, 75 Fed. Cl. 406 (2007)). The court also is cognizant of the Supreme Court’s instruction that “[t]he scope of review under the ‘arbitrary and capricious’ standard is narrow and a court is not to substitute its judgment for that of the agency.” Motor Vehicle Mfrs. Ass’n v. State 13 The Administrative Record at the citations offered by intervenor does not demonstrate the AAP was well researched, as the pages include how the IGCE was established, and included a document titled: “This page provides examples of key activities, this DOES NOT provide any approval to do work. But if work is approved this is what we mean,” and included examples of “Clean Toilet,” “Dryer Vent Cover,” “Fungicidal Protective Coating,” and “Roof Components.” (capitalization and emphasis in original). 62 Farm Mut. Auto. Ins. Co., 463 U.S. at 43 . The court does not seek to substitute its judgment for the agency. The court, however, already found the agency was arbitrary and capricious with regard to the past performance evaluation of ISN. Regarding price, the agency has failed to explain why it found ISN’s price was realistic, why it chose the various metrics to evaluate price realism, and which metric the agency applied to determine price realism. Despite the documentation provided by the agency quoted above, there remains insufficient explanation of why the agency found ISN’s price realistic for the requirements of the Solicitation. The court notes that although, the GAO found the USDA’s price realism analysis was reasonable, the GAO did not attempt to determine why the agency used both the CPR and the AAP, and just concluded: “[W]e find that the agency's use of a second benchmark (the AAP) was a reasonable further step to consider and compare the pricing received to the pricing received by other agencies for similar services, and find no support for the protester's assertion that this extra step was arbitrary or unnecessary.” Mortg. Contracting Servs., LLC, B-418483.2, B-418483.3, 2020 WL 6625956 , at *10 (capitalization and brackets in original) (internal references omitted). The court believes the GAO did not critically examine why the agency used two different benchmarks or why the benchmarks produced differing results, and if that would have raised questions about the agency’s price realism analysis. Additional Claim In its amended complaint, protestor raised another claim, that the USDA irrationally failed to assign a deficiency to ISN’s proposal, MCS alleged the “Solicitation included a clear requirement that PWS Tasks 1-6 be performed in accordance with the following AQL: ‘95% of tasks will be completed within 10 days. The remaining 5% will be completed within 21 days unless there is an exception granted by the Government,’” and argued that “ISN did not meet the AQL requirement to perform 95% of each of PWS Tasks 1-6 within 10 days. Instead, for each of those Tasks, ISN proposed to perform 95% of the work within 14 days,” and the “USDA should have assigned ISN a Deficiency in accordance with the Solicitation’s stated evaluation criteria.”14 The Solicitation required that PWS Tasks 1-6 be performed in accordance with the following AQL: “95% of tasks will be completed within 10 days. The remaining 5% will be completed within 21 days unless there is an exception granted by the Government.” evaluation of an offeror’s proposal for Tasks 1-6 would occur pursuant to Technical Factor 1, Subfactor 3, “Management Approach,” which the Solicitation stated would be evaluated and rated according to the following criteria: Demonstration that the offeror can provide all management, supervision, labor, tools, supplies, insurance, taxes, fees, permits to complete the services, including all reporting and documentation as explicitly set forth in the PWS. A demonstration of how offeror will manage RD’s large nationwide portfolio an and all quality assurance implementation. A QASP must be submitted with this plan (see QASP Template Attachment C2). 14 This additional claim was not raised at the GAO. 63  Intervenor argued that as submitted, “[a]lthough ISN’s proposal mistakenly referenced a 14-day completion timeline for these tasks, this did not make ISN’s proposal noncompliant.” Citing IBM Corp. v. United States 119 Fed. Cl. 145 , 157 (2014), intervenor argued that the “[p]rinciples of interpretation suggest that the Court should read the proposal as a whole in order to discern the meaning of any individual parts.” Additionally, ISN asserted: USDA gave wholistic effect to ISN’s proposal by assuming (as was true) that the reference to 14 days for these Tasks was inadvertent and that ISN intended to perform these tasks within 10 days — as the totality of its proposal indisputably guaranteed. This conclusion was more than reasonable because ISN’s proposal overwhelmingly affirmed that it would provide timely compliance for Tasks 1 through 6. The court notes that although Tasks 1-6 require “95% of tasks will be completed within 10 days. The remaining 5% will be completed within 21 days unless there is an exception granted by the Government,” a number of the other Tasks in the Performance Work Statement do allow for the offeror to complete 95% of the work within 14 days, as offered by ISN’s proposal. For example, Task 7 - Automobile Removal requires “95% of tasks will be completed within 14 days; remaining 5% will be completed within 21 days unless an exception is granted by RD,” and likewise, Task 10 - Code Violations requires “95% of tasks will be completed within 14 days; remaining 5% will be completed within 21 days unless an exception is granted by RD.” By specifying that Tasks 1-6 require “95% of tasks will be completed within 10 days,” compared to the 14 days for other tasks in PWS, the agency intentionally was seeking to have the overwhelming majority of Tasks 1-6 completed in the 10 day timeframe. Despite this, in its evaluation of ISN’s Technical proposal, the agency overlooked, or ignored, the mistake in ISN’s proposal and, nonetheless, awarded ISN an “Outstanding” rating for Technical Factor 1, Subfactor 3. It is not clear to the court if the agency overlooked or ignored the inconsistency as the agency did not document or explain its decision. Included in ISN’s proposal was a “Proposed Quality Assurance Surveillance Plan,” which indicated that “[u]pon receipt of task orders from USDA RD, [redacted]. Expected completion dates will be based on USDA RD requirements,” and unlike the portion of the Technical proposal which indicated that 95% of Tasks 1-6 would be completed within 14 days, the Proposed Quality Assurance Surveillance Plan reflected that for Tasks 1-6, “95% of tasks will be completed within 10 days.” The agency did not emphasize that the Proposed Quality Assurance Surveillance Plan indicated the correct timeframe, or contrasted the Proposed Quality Assurance Surveillance Plan with the rest of ISN’s Technical proposal. Nor is there any explanation that the agency assumed, as ISN argued, “that the reference to 14 days for these Tasks was inadvertent.” Defendant contends that the narrative that indicates a 14-day timeframe was part of ISN’s Management Approach. The evaluation criteria for Management Approach do not specifically require the agency to evaluate whether Tasks 1-6 would be completed within the timeframe set forth in the Performance 64  Requirement Summary. Therefore, the agency’s evaluation of ISN’s Management Approach narrative did not entail an assessment of ISN’s ability to timely complete Tasks 1-6, and, therefore, ISN’s reference to 14 days (rather than 10 days) had no effect on ISN’s Management Approach rating. (capitalization and emphasis in original). The government appears to be suggesting that, although the ten day requirement was part of the Solicitation and the Performance Work Statement requirements, because the agency’s evaluation “did not entail an assessment of ISN’s ability to timely complete Tasks 1-6, and, therefore, ISN’s reference to 14 days (rather than 10 days) had no effect on ISN’s Management Approach rating.” ISN’s failure meet the requirement, however, renders ISN’s proposal non-responsive to the Solicitation. The Federal Circuit has stated that “‘a proposal that fails to conform to the material terms and conditions of the solicitation should be considered unacceptable and a contract award based on such an unacceptable proposal violates the procurement statutes and regulations.’” Allied Tech. Grp., Inc. v. United States, 649 F.3d at 1329 (quoting E.W. Bliss Co. v. United States, 77 F.3d at 448 ); see also Centech Grp., Inc. v. United States, 554 F.3d 1029 , 1039 (Fed. Cir. 2009) (holding that a proposal that did not offer to provide what the request for proposals requests was not responsive to the request for proposals); Gen. Dynamics Mission Sys., Inc. v. United States, 137 Fed. Cl. 493 , 521-22 (2018); Prescient, Inc. v. United States, 125 Fed. Cl. 475 , 491 (2016). In Centech, the Federal Circuit further explained,“[t]o be acceptable, a proposal must represent an offer to provide the exact thing called for in the request for proposals, so that acceptance of the proposal will bind the contractor in accordance with the material terms and conditions of the request for proposals.” Centech Grp., Inc. v. United States, 554 F.3d at 1037 . “‘A solicitation term is material where it has more than a negligible impact on the price, quantity, quality, or delivery of the subject of the [proposal].’” Transatlantic Lines, LLC v. United States, 122 Fed. Cl. 624 , 632 (2015) (quoting Blackwater Lodge & Training Ctr., Inc. v. United States, 86 Fed. Cl. 488 , 505 (2009)) (brackets in original). ISN’s proposal on its face did not “represent an offer to provide the exact thing called for in the request for proposals,” by proposing to complete 95% of Tasks 1-6 of the PWS in 14 days rather than the 10 days required in the Solicitation. ISN’s after the fact representation that it was inadvertent and it that “ISN intended to perform these tasks within 10 days,” cannot not change the terms of its proposal. Despite defendant’s argument, the Federal Circuit’s guidance regarding non-compliant proposals is not limited by an agency’s choice for how consider the non-complaint submission in an agency’s evaluation of proposals. Consistency and proper responses to the Solicitation regarding timely performance of individual task in the statement of work are important elements of responsiveness and meeting the stated requirements of the Solicitation. Therefore, if the failure to correctly and consistently meet the timing requirements of the Tasks in the Performance Work Statement rendered ISN’s proposal noncompliant, the defendant’s and intervenor’s arguments are without merit. 65 Standing and Prejudice As noted above, the court has determined that the USDA was arbitrary and capricious in its evaluation of ISN’s proposal, and the court must also determine if MCS was prejudiced by the agency’s actions. Intervenor ISN argued that “MCS is not in line for an award, so its protest should be dismissed,” and contends that “[t]he Administrative Record confirms that MCS is not in line for the award due to its unreasonably high price. Therefore, MCS’s protest should be dismissed (and its request for injunctive relief denied as moot).” Similarly, defendant argued that “MCS lacks standing to challenge the award to ISN. The agency determined that MCS’s price was too high to receive an award.” More specifically, defendant cited the USDA’s determination that “MCS’s ‘pricing is unreasonably high based on the comparative analysis performed for this solicitation,’” and argued “MCS’s unrealistically high price ‘precludes them from being in line for the award,’” and concludes that “the Court should dismiss this protest for lack of standing.” In response, protestor states that the “USDA expressly determined MCS’ pricing to be fair and reasonable, and MCS was the second offeror in line for award after ISN. Accordingly, MCS is an interested party with standing in this case.” It is well established that “‘subject-matter jurisdiction, because it involves a court’s power to hear a case, can never be forfeited or waived.’” Arbaugh v. Y & H Corp., 546 U.S. 500 , 514 (2006) (quoting United States v. Cotton, 535 U.S. 625 , 630 (2002)). “[F]ederal courts have an independent obligation to ensure that they do not exceed the scope of their jurisdiction, and therefore they must raise and decide jurisdictional questions that the parties either overlook or elect not to press.” Henderson ex rel. Henderson v. Shinseki, 562 U.S. 428 (2011); see also Hertz Corp. v. Friend, 559 U.S. 77 , 94 (2010) (“Courts have an independent obligation to determine whether subject-matter jurisdiction exists, even when no party challenges it.” (citing Arbaugh v. Y & H Corp., 546 U.S. at 514 )); Special Devices, Inc. v. OEA, Inc., 269 F.3d 1340 , 1342 (Fed. Cir. 2001) (“[A] court has a duty to inquire into its jurisdiction to hear and decide a case.” (citing Johannsen v. Pay Less Drug Stores N.W., Inc., 918 F.2d 160 , 161 (Fed. Cir. 1990))); View Eng’g, Inc. v. Robotic Vision Sys., Inc., 115 F.3d 962 , 963 (Fed. Cir. 1997) (“[C]ourts must always look to their jurisdiction, whether the parties raise the issue or not.”). “The objection that a federal court lacks subject-matter jurisdiction . . . may be raised by a party, or by a court on its own initiative, at any stage in the litigation, even after trial and the entry of judgment.” Arbaugh v. Y & H Corp., 546 U.S. at 506 ; see also Hymas v. United States, 810 F.3d 1312 , 1317 (Fed. Cir. 2016) (explaining that a federal court must satisfy itself of its jurisdiction over the subject matter before it considers the merits of a case); Cent. Pines Land Co., L.L.C. v. United States, 697 F.3d 1360 , 1364 n.1 (Fed. Cir. 2012) (“An objection to a court's subject matter jurisdiction can be raised by any party or the court at any stage of litigation, including after trial and the entry of judgment.” (citing Arbaugh v. Y & H Corp., 546 U.S. at 506 )); Rick’s Mushroom Serv., Inc. v. United States, 521 F.3d 1338 , 1346 (Fed. Cir. 2008) (“[A]ny party may challenge, or the court may raise sua sponte, subject matter jurisdiction at any time.” (citing Arbaugh v. Y & H Corp., 546 U.S. at 506 ; Folden v. United States, 379 F.3d 1344 , 1354 (Fed. Cir.), reh’g and reh’g en banc denied (Fed. Cir. 2004), cert. denied, 545 U.S. 1127 (2005); and Fanning, Phillips & Molnar v. West, 160 F.3d 717 , 720 (Fed. Cir. 1998))); Pikulin v. United States, 97 Fed. Cl. 71 , 76, appeal dismissed, 425 F. App’x 902 (Fed. Cir. 2011). In fact, “[s]ubject matter 66 jurisdiction is an inquiry that this court must raise sua sponte, even where . . . neither party has raised this issue.” Metabolite Labs., Inc. v. Lab. Corp. of Am. Holdings, 370 F.3d 1354 , 1369 (Fed. Cir.) (citing Textile Prods., Inc. v. Mead Corp., 134 F.3d 1481 , 1485 (Fed. Cir.), reh’g denied and en banc suggestion declined (Fed. Cir.), cert. denied, 525 U.S. 826 (1998)), reh’g and reh’g en banc denied (Fed. Cir. 2004), cert. granted in part sub. nom Lab. Corp. of Am. Holdings v. Metabolite Labs., Inc., 546 U.S. 975 (2005), cert. dismissed as improvidently granted, 548 U.S. 124 (2006). This court has jurisdiction to hear bid protests pursuant to 28 U.S.C. § 1491 (b)(1) (2018) of the Tucker Act, which provides that this court has jurisdiction to render judgment on an action by an interested party objecting to a solicitation by a Federal agency for bids or proposals for a proposed contract or to a proposed award or the award of a contract or any alleged violation of statute or regulation in connection with a procurement or a proposed procurement. 28 U.S.C. § 1491 (b)(1); see also Weeks Marine, Inc. v. United States, 575 F.3d at 1359 (Fed. Cir. 2009). The Administrative Dispute Resolution Act of 1996, codified at 28 U.S.C. § 1491 (b)(1)–(4), amended the Tucker Act to establish a statutory basis for bid protests in the United States Court of Federal Claims. See Impresa Construzioni Geom. Domenico Garufi v. United States, 238 F.3d at 1330–32. The Tucker Act grants the United States Court of Federal Claims “jurisdiction to render judgment on an action by an interested party objecting to a solicitation by a Federal agency for bids or proposals for a proposed contract or to a proposed award or the award of a contract or any alleged violation of statute or regulation in connection with a procurement or a proposed procurement.” 28 U.S.C. § 1491 (a)(1). In order to have standing to sue as an “interested party” under this provision, a disappointed bidder must show that it suffered competitive injury or was “prejudiced” by the alleged error in the procurement process. See Todd Constr., L.P. v. United States, 656 F.3d 1306 , 1315 (Fed. Cir. 2011) (To prevail, a bid protester must first “‘show that it was prejudiced by a significant error’ (i.e., ‘that but for the error, it would have had a substantial chance of securing the contract).’” (quoting Labatt Food Serv., Inc. v. United States, 577 F.3d 1375 , 1378, 1380 (Fed. Cir. 2009)); see also Eskridge & Assocs. v. United States, 955 F.3d 1339 , 1345 (Fed. Cir. 2020) (“In a post-award bid protest, the relevant inquiry is whether the bidder had a ‘substantial chance’ of winning the award—specifically, whether a protestor ‘establish[ed] not only some significant error in the procurement process, but also that there was a substantial chance it would have received the contract award but for that error.’” (quoting Statistica, Inc. v. Christopher, 102 F.3d at 1582 )) (alteration in original); Blue & Gold Fleet, L.P. v. United States, 492 F.3d at 1317 ; AECOM Mgmt. Servs., Inc. v. United States, 147 Fed. Cl. 285 , 290 (2020); Sci. Applications Int’l Corp. v. United States, 108 Fed. Cl. 235 , 281 (2012); Linc Gov’t Servs., LLC v. United States, 96 Fed. Cl. at 693 (“In order to establish standing to sue, the plaintiff in a bid protest has always needed to demonstrate that it suffered competitive injury, or ‘prejudice,’ as a result of the allegedly unlawful agency decisions.” (citing Rex Serv. Corp. v. United States, 448 F.3d 1305 , 1308 (Fed. Cir. 2006); Statistica, Inc. v. Christopher, 102 F.3d at 1580–81; 67 Vulcan Eng’g Co. v. United States, 16 Cl. Ct. 84 , 88 (1988); Morgan Bus. Assocs., Inc. v. United States, 223 Ct. Cl. 325 , 332 (1980))). In order to establish what one Judge on this court has called “allegational prejudice” for the purposes of standing, the bidder must show that there was a “substantial chance” it would have received the contract award, but for the alleged procurement error. See Linc Gov’t Servs., LLC v. United States, 96 Fed. Cl. at 675; Hyperion, Inc. v. United States, 115 Fed. Cl. 541 , 550 (2014) (“The government acknowledges that proving prejudice for purposes of standing merely requires “allegational prejudice,” as contrasted to prejudice on the merits . . . .”); Bannum, Inc. v. United States, 115 Fed. Cl. 148 , 153 (2014); see also Bannum, Inc. v. United States, 404 F.3d at 1358 ; Galen Med. Assocs., Inc. v. United States, 369 F.3d at 1331 ; Info. Tech. & Applications Corp. v. United States, 316 F.3d at 1319 ; Statistica, Inc. v. Christopher, 102 F.3d at 1581 ; Archura LLC v. United States, 112 Fed. Cl. 487 , 497 (2013); Lab. Corp. of Am. v. United States, 108 Fed. Cl. 549 , 557 (2012). Because standing is a jurisdictional issue, this showing of prejudice is a threshold issue. See Corus Grp. PLC. v. Int’l Trade Comm'n, 352 F.3d 1351 , 1357 (Fed. Cir. 2003); Myers Investigative & Sec. Servs., Inc. v. United States, 275 F.3d 1366 , 1370 (Fed. Cir. 2002). In a post-award bid protest, such as the above-captioned bid protest, the “protestor must ‘establish that it (1) is an actual or prospective bidder, and (2) possesses the requisite direct economic interest.’” Mgmt. & Training Corp. v. United States, 137 Fed. Cl. 780 , 783-84 (2018) (quoting Rex Serv. Corp. v. United States, 448 F.3d at 1307 ); see also Digitalis Educ. Sols., Inc. v. United States, 664 F.3d 1380 , 1384 (Fed. Cir. 2012) (“An interested party is an actual or prospective bidder whose direct economic interest would be affected by the award of the contract. Thus, a party must show that it is 1) an actual or prospective bidder and 2) that it has a direct economic interest.”); Glocoms, Inc. v. United States, 150 Fed. Cl. 258 , 264 (2020); AECOM Mgmt. Servs., Inc. v. United States, 147 Fed. Cl. at 290; PAE-Parsons Global Logistics Servs,. LLC v. United States, 145 Fed. Cl. 194 , 198 (2019); Timberline Helicopters, Inc. v. United States, 140 Fed. Cl. 117 , 120 (2018); Contract Servs., Inc. v. United States, 104 Fed. Cl. 261 , 269 (2012). As noted above, protestor alleged that MCS is an interested party with standing to bring this protest because it is an actual bidder with a substantial chance of receiving the award but for USDA’s evaluation errors,” ISN claimed that “MCS is not in line for an award, so its protest should be dismissed,” and defendant argued that “MCS lacks standing to challenge the award to ISN. The agency determined that MCS’s price was too high to receive an award.” Under the heading: “Relative Importance of Factors” the Solicitation stated: The award resulting from this solicitation will be made based on the best overall proposal that is determined to be the most beneficial to the Government (i.e., best value tradeoff process). The Technical Capability Factor is slightly more important than the Past Performance Factor. Technical Capability Subfactors, 1.1, 1.2, 1.3, 1.4 and 1.5, are rated in descending order of importance. Overall, Non-Price Factors, when combined, are significantly more important than Price. Price is not an adjectivally rated Factor; however, the Price Factor will become the more dominant factor as technical proposals reach technical equality. In such 68  cases, where all non-priced factors being evaluated are virtually the same, best value may be represented by the lowest-priced proposal. The Administrative Record makes clear that as evaluated ISN and MCS were the two strongest offerors for the Technical Factor and the Past Performance Factor. The Proposal Analysis Report listed the ratings for MCS’ proposal as “Outstanding” for each Factor and each subfactor, and found the same for ISN’s proposal. ISN and MCS were the only two offerors to receive “Outstanding” ratings. In discussing price competition, the Proposal Analysis Report determined: As discussed above four(4) of the eleven(11) offerors competing for the Property Preservation and Inspection contract were determined not to have submitted technical acceptable proposals: CWIS (Marginal); IEI, NHC, UFS (all “Unacceptable”). That left remaining seven(7) that were considered to have a technically “Acceptable” proposals that rated from Acceptable- Good-Outstanding. Of the seven(7), technical acceptable proposal, their pricing for Task Order 1, has a CPR of approximately $25M to $28M, on the CPR price spectrum. Therefore, based on the foregoing findings, and because multiple offers were received from several offerors that were considered responsible and were competing independently for the subject contract, the Technical Evaluation Team (TET) and the Source Selection Authority (SSA) determined that, in accordance with the provisions of FAR 15.403-1, Adequate Price Competition did exist for the procurement. In evaluating price, it was indicated in the solicitation, Attachment C-4, Instructions to Offerors, Evaluation and Basis for Award, par. 4, that “Price is not an adjectivally rated Factor; however, the Price Factor will become the more dominant factor as technical proposals reach technical equality. In such cases, where all nonprice factors being evaluated are virtually the same, best value may be represented by the lowest-priced proposal. Upon information above, and upon performing an integrated assessment of technical (including past performance) and price this competition came down to ISN and MCS, both providing technical exceptional proposals, and competitive pricing as being in line for award. However, in accordance with the solicitation and the CO’s determination and recommendation in the Price Competition Memorandum, of the two exceptionally technically equal offerors, ISN, as the lowest price, provides the best overall value to the Government, with a technically superior proposal at a price that is comparatively competitive, fair and reasonable, balanced and realistic for the work. Therefore, there is no need for establishing a competitive range and going into discussions, because two highly rated exceptional proposals were received and there are no improvements required from either a technical or cost standpoint. There is no basis for a tradeoff between ISN and MCS due 69  to MCS did not supply any features which would warrant the premium in price offered over the lower price offered from ISN. Best value has been established with a superior technical proposal, with substantial past performance confidence rating, and reasonable, balanced and realistic pricing, all resulting in no risk to contract performance. Regarding the MCS proposal, the Proposal Analysis Report stated, “even though MCS’s pricing is found to be realistic and in conformity for their proposed technical approach, their pricing is unreasonably high based on the comparative analysis performed for this solicitation,” and determined, “[t]herefore, MCS is not determined to be the best value in accordance with the evaluation criteria. MCS tied ISN in their technical rating with an ‘outstanding’ but had an overall higher price.” Under the heading labeled, “CONTRACTING OFFICER RECOMMENDATION,” the Price Competition Memo stated: Best Value/Trade-Off. It is found that a trade-off analysis is not required based on my findings in the technical and pricing received from all offerors which had a lower technical rating and higher price than the recommended awardee. Technically, two offerors were rated “outstanding” and there were no discriminators in their technical ratings to lean towards performing a tradeoff. The only discriminator, as indicated below is the divergent pricing, with MCS on the higher spectrum of the CPR, and ISN on the lower side. Note, the solicitation indicated that where all “non-price factors being evaluated are virtually the same, best value may be represented by the lowest-priced proposal.” That is the case as noted below in this competition, where CLINs one and two were evaluated for the task order. (capitalization and emphasis in original). The Source Selection Decision Document was consistent with the conclusions of the Proposal Analysis Report and Price Competition Memo: The solicitation indicated that to be considered for award, Offerors must be rated overall as “Acceptable”. Since [redacted] were rated below “Acceptable,” and had pricing issues ranging from not fair, reasonable, realistic or balanced, incompliant with the solicitation, their proposals were found to be un-awardable for this solicitation requirement. Five of the Offerors ([redacted]) were rated “Acceptable” to “Good”. Overall, my review concurs with the finding that their respective ratings ranging from “Acceptable” and “Good”, does not demonstrate the highest understanding of the requirement, and therefore un-awardable for this solicitation requirement. Two of the Offerors, ISN and MCS, both rated “Outstanding” demonstrating that their technical proposals provided the highest understanding of the requirement. In addition, both Offerors were assessed Past Performance Confidence rating of “Substantial. However, the greatest discriminator between the Offeror’s proposal was in their pricing. MCS 70  pricing was higher and outside of the competitive pricing of other acceptable offerors; whereas, ISN’s pricing was the lowest, and comparable to the competitive pricing from other CPR range Offerors. (capitalization in original). The Source Selection Decision Document concluded: MCS’s Pricing for both the Task Order 1 and IDIQ are well over the respective CPR: Task Order 1 of $[redacted] ( CPR, $28,794,738.00); IDIQ ceiling $[redacted] (CPR $43,239,629.00) and even though deemed fair, reasonable, realistic and balanced in accordance with their technical approach, and historical pricing, their pricing is not competitive for this solicitation. MCS’ price for Task Order 1, at $[redacted] is approximately $[redacted] over ISN price of $21,288,840.00; and for the overall IDIQ is approximately $[redacted[ higher. Therefore, I concur with the TET, and the Contracting Officer’s evaluation that MCS’s proposal is not determined to be the best value in accordance with the evaluation criteria discussed in the solicitation. The solicitation, under Attachment C4, par. 4, entitled Competition Instructions, Evaluation and Basis for award, it [sic] is stated that: “Overall, Non-Price Factors, when combined, are significantly more important than Price. Price is not an adjectivally rated Factor; however, the Price Factor will become the more dominant factor as technical proposals reach technical equality. In such cases, where all nonprice factors being evaluated are virtually the same, best value may be represented by the lowest-priced proposal”. Upon reviewing the information provided by the TET, as summarized above for the two technically highest rated Offerors, it is determined that Offeror, Information Systems and Network Corporation clearly provided the best value proposal, all factors considered. Their proposal was technically outstanding as well as appropriately priced and aligned with their technical approach to the solicitation requirement. In my integrated assessment, I reviewed, in detail, both the merits and confidence ratings achieved by the highest rated offerors across the spectrum of evaluation factors and subfactors to select, with certainty, the most highly rated and qualified offeror, given the importance of the individual factors, for this solicitation requirement. (capitalization and emphasis in original). The Proposal Analysis Report, Price Competition Memo, and the Source Selection Decision Document all agreed that only ISN and MCS offered “Outstanding” proposals, and were the only two considered for award, and the Source Selection Decision Document labeled every other proposal “un- 71 awardable for this solicitation requirement.” All three agency evaluations emphasized that “Non-Price Factors, when combined, are significantly more important than Price,” and that Price was “not an adjectivally rated Factor.” The documents quoted above specifically note that ISN was awarded the contract over MCS only because of ISN’s lower price. As the court has determined that the agency committed errors in the evaluation of ISN’s proposal, it is not clear that ISN would have achieved the same Outstanding ratings as MCS, and, therefore, there is a “substantial chance” that MCS “would have received the contract award but for that error.” Eskridge & Assoc. v. United States, 955 F.3d at 1345 (quoting Statistica, Inc. v. Christopher, 102 F.3d at 1582 ); see also Glenn Def. Marine (ASIA), PTE Ltd. v. United States, 720 F.3d at 912. Defendant and intervenor referred to the documents that reference MCS’ higher price. In the Proposal Analysis Report, MCS’ pricing is described as “unreasonably high,” and “unreasonably high based on the comparative analysis performed for this solicitation.” The agency’s Proposal Analysis Report, however, also stated “MCS’s pricing is found to be realistic and in conformity for their proposed technical approach.” Additionally, the agency in the Price Competition Memo indicated: Although MCStechincal [sic] rating is outstanding, pricing is at the higher end of the CPR, and is much higher than other similar ranked proposals which precludes them from being in line for an award. Note, in accordance with evaluation criteria set forth in Section M paragraph 4., “the Price Factor will become the more dominant factor as technical proposals reach technical equality. In such cases, where all non-priced factors being evaluated are virtually the same, best value may be represented by the lowest-priced proposal.” (capitalization in original). Despite this statement in the Price Competition Memo, the conclusion of the Price Competition Memo did not indicate that MCS was not eligible for award, nor did the Source Selection Decision Document, which determined that MCS’ pricing was “deemed fair, reasonable, realistic and balanced in accordance with their technical approach, and historical pricing,” but that MCS’ “pricing is not competitive for this solicitation.” As noted above, the Proposal Analysis Report, Price Competition Memo, and the Source Selection Decision Document were in agreement that the only two proposals considered for award were only ISN and MCS as ISN and MCS were the only proposals rated offered “Outstanding” for Technical and “Substantial Confidence” for Past Performance. The Price Competition Memo noted that price was the determining factor in recommending ISN for award and that: Technically, two offerors were rated “outstanding” and there were no discriminators in their technical ratings to lean towards performing a tradeoff. The only discriminator, as indicated below is the divergent pricing, with MCS on the higher spectrum of the CPR, and ISN on the lower side. Note, the solicitation indicated that where all “non-price factors being evaluated are virtually the same, best value may be represented by the lowest-priced 72  proposal.” That is the case as noted below in this competition, where CLINs one and two were evaluated for the task order. (capitalization in original). The Proposal Analysis Report also determined, “[u]pon information above, and upon performing an integrated assessment of technical (including past performance) and price this competition came down to ISN and MCS, both providing technical exceptional proposals, and competitive pricing as being in line for award,” despite previously indicating MCS’ price proposals was “unreasonably high based on the comparative analysis performed for this solicitation.” MCS higher price, although the basis for not receiving the award, based perhaps on the faulty evaluations, did not eliminate it from consideration. MCS has demonstrated standing, and has proven prejudice. Injunctive Relief After concluding the agency’s evaluation of ISN was arbitrary and capricious, and that MCS was prejudiced by the agency’s actions, the court considered whether MCS is entitled to the requested injunctive relief. In Centech Group, Inc. v. United States, the Federal Circuit set out the test for a permanent injunction, stating: To determine if a permanent injunction is warranted, the court must consider whether (1) the plaintiff has succeeded on the merits of the case; (2) the plaintiff will suffer irreparable harm if the court withholds injunctive relief; (3) the balance of hardships to the respective parties favors the grant of injunctive relief; and (4) the public interest is served by a grant of injunctive relief. Centech Grp., Inc. v. United States, 554 F.3d at 1037 (citing PGBA, LLC v. United States, 1228–29 (Fed. Cir. 2004) (citing Amoco Prod. Co. v. Vill. of Gambell, Alaska, 480 U.S. 531 , 546 n.12 (1987))); see also Nat’l Steel Car, Ltd. v. Canadian Pacific Ry., Ltd., 357 F.3d 1319 , 1325 (Fed. Cir.) (finding that a plaintiff who cannot demonstrate actual success on the merits cannot prevail on its motion for permanent injunctive relief), reh’g and reh’g en banc denied (Fed. Cir. 2004); MVM, Inc. v. United States, 149 Fed. Cl. 478 , 492 (2020); Kiewit Infrastructure West Co. v. United States, 147 Fed. Cl. 700 , 712 (2020); Remington Arms Co., LLC v. United States, 126 Fed. Cl. 218 , 232 (2016). Success on the merits has been said to be “the most important factor for a court to consider when deciding whether to issue injunctive relief.” Dellew Corp. v. United States, 108 Fed. Cl. 357 , 369 (2012) (citing Blue & Gold Fleet, L.P. v. United States, 492 F.3d at 1312 ). While success on the merits is necessary, it is not sufficient for plaintiff to establish that it is entitled to injunctive relief. See Contracting, Consulting, Eng’g LLC v. United States, 104 Fed. Cl. at 353 (“Although plaintiff’s entitlement to injunctive relief depends on its succeeding on the merits, it is not determinative because the three equitable factors must be considered, as well.”) (citing PGBA, LLC v. United States, 389 F.3d 1219 , 1228-29 (Fed. Cir. 2004)). The four factors are to be considered collectively, rather than individually, such that “[n]o one factor, taken individually, is necessarily dispositive. . . . [T]he weakness of the showing regarding one factor may be overborne by the strength of the others.” FMC Corp. [v. United States], 3 F.3d [424] at 427 73  [(Fed. Cir. 1993)]. Conversely, “the absence of an adequate showing with regard to any one factor may be sufficient” to deny injunctive relief. Id. Sheridan Corp. v. United States, 94 Fed. Cl. 663 , 668 (2010); see also Computer World Servs. Corp. v United States, 147 Fed. Cl. 584 , 595 (2020); Wallace Asset Mgmt., LLC v. United States, 125 Fed. Cl. 718 , 727 (2016); Amidon, Inc. v. United States, 124 Fed. Cl. 517 , 522 (2015). In the above captioned bid protest, as discussed above, MCS established success on the merits by demonstrating that the agency acted arbitrarily and capriciously regarding the agency’s evaluation of ISN’s proposal. Having concluded that protestor had succeeded on the merits of its bid protest, the court considered the additional factors to determine whether protestor was entitled to injunctive relief. Regarding whether or not the protestor will suffer irreparable harm if injunctive relief is not granted, “[w]hen assessing irreparable injury, ‘[t]he relevant inquiry in weighing this factor is whether plaintiff has an adequate remedy in the absence of an injunction.’” Insight Sys. Corp. v. United States, 110 Fed. Cl. 564 , 582 (2013) (quoting Magellan Corp. v. United States, 27 Fed. Cl. 446 , 447 (1993)); see also Rush Constr., Inc. v. United States, 117 Fed. Cl. 85 , 101 (2014); CW Gov’t Travel, Inc. v. United States, 110 Fed. Cl. at 494; Overstreet Elec. Co. v. United States, 47 Fed. Cl. 728 , 743 (2000). “As to the second factor, irreparable harm exists when an offeror has lost the opportunity to compete fairly for a contract.” Kiewit Infrastructure West Co. v. United States, 147 Fed. Cl. at 712 (citing HP Enter. Servs., LLC v. United States, 104 Fed. Cl. 230 , 245 (2012)). “The Court of Federal Claims has repeatedly held that a protester suffers irreparable harm if it is deprived of the opportunity to compete fairly for a contract.” CW Gov’t Travel, Inc. v. United States, 110 Fed. Cl. at 494 (citing CRAssociates, Inc. v. United States, 95 Fed. Cl. 357 , 390–91 (2010); Serco, Inc. v. United States, 81 Fed. Cl. at 501–02; Impresa Construzioni Geom. Domenico Garufi v. United States, 52 Fed. Cl. 826 , 828 (2002)); see also Remington Arms Co., LLC v. United States, 126 Fed. Cl. at 232 (explaining that the loss of potential work and profits from a government contract constitutes irreparable harm); BINL, Inc. v. United States, 106 Fed. Cl. 26 , 48 (2012) (“Irreparable harm is established by a lost opportunity to fairly compete.”); HP Enter. Servs., LLC v. United States, 104 Fed. Cl. at 245 (citing several cases); Magnum Opus Techs., Inc. v. United States, 94 Fed. Cl. 512 , 544 (2010) (“‘A lost opportunity to compete in a fair competitive bidding process for a contract is sufficient to demonstrate irreparable harm.’”), motion to amend denied, 94 Fed. Cl. 553 (2010) (internal citations omitted). The loss of a valuable business opportunity “deriving from a lost opportunity to compete in a fair competitive bidding process for a contract,” can be sufficient to constitute irreparable harm. See Overstreet Elec. Co. v. United States, 47 Fed. Cl. at 744 (citing United Int’l Investigative Servs., Inc. v. United States, 41 Fed. Cl. 312 , 323 (1998)); see also KWR Constr., Inc. v. United States, 124 Fed. Cl. at 363 (agreeing with protestor that the lost opportunity to compete for a future contract will cause irreparable harm); Impresa Construzioni Geom. Domenico Garufi v. United States, 52 Fed. Cl. at 828; United Int’l Investigative Servs., Inc. v. United States, 41 Fed. Cl. at 323 (“[T]he opportunity to compete for a contract and secure any resulting profits has been recognized to constitute significant harm.”). 74 According to a judge of this court, “[t]he court has repeatedly held that ‘the loss of potential profits’ from a government contract constitutes irreparable harm.” BINL, Inc. v. United States, 106 Fed. Cl. at 49 (quoting Furniture by Thurston v. United States, 103 Fed. Cl. 505 , 520 (2012) (citing BayFirst Sols., LLC v. United States, 102 Fed. Cl. 677 , 696 (2012))); see also MORI Assocs., Inc. v. United States, 102 Fed. Cl. 503 , 552–53 (2011). Additionally, Judges of the United States Court of Federal Claims have determined that a protester suffers irreparable injury when it has been deprived the opportunity to compete fairly for a contract. See Wackenhut Servs., Inc. v. United States, 85 Fed. Cl. 273 , 311 (2008) (citing Cardinal Maint. Serv., Inc. v. United States, 63 Fed. Cl. 98 , 110 (2004)); see also Info. Scis. Corp. v. United States, 73 Fed. Cl. at 127. Defendant argued that “MCS’s failure to establish likelihood of success on the merits and irreparable harm warrants denial of its request.” Protestor argued that “MCS was not given the opportunity to compete fairly in the procurement process based on the USDA’s unreasonable evaluation errors,” and argued that immediate injunctive relief was “necessary to prevent the loss of anticipated profits from performance of the contract,” and concluded, “[t]he loss of this opportunity is irreparable because MCS has no adequate remedy at law, which would merely provide for bid preparation costs.” The court agrees with protestor that it would have faced irreparable harm if an injunction was not granted. Regarding the third factor, the balancing of the hardships, protestor claimed that “[t]he USDA faces no apparent hardship, as there will be no delay in performance if the injunctive relief is granted, and any inconvenience caused to ISN by a delayed contract award and transition is minimal.” Protestor also claimed “MCS will face significant hardship if the Agency goes forward with its award to ISN. MCS will face lost profits from performance while the legal action is ongoing and will have to re-transition into its role as the contractor if it is later granted the award based on a reasonable evaluation of the proposals.” Defendant responded that the “agency suffers significant financial harm while MCS protests this award (for the second time on the merits),” and claimed, “the daily average cost difference to the agency while MCS, rather than ISN, performs is $26,310.14,” and “[m]oreover, the agency will continue to suffer financial harm the longer that ISN’s performance is delayed.” Although there could be some hardship and cost for the government to revisit a procurement, including this one, that hardship is outweighed by the hardship to protestor when a flawed procurement evaluation is allowed to stand. As to the public interest factor, “‘[t]he public interest in honest, open, and fair competition in the procurement process is compromised whenever an agency abuses its discretion.’” CW Gov’t Travel, Inc. v. United States, 110 Fed. Cl. at 495 (quoting PGBA, LLC v. United States, 57 Fed. Cl. 655 , 663 (2003)); see also Cohen Fin. Servs., Inc. v. United States, 110 Fed. Cl. 267 , 289 (2013); United Int’l Investigative Servs., Inc. v. United States, 41 Fed. Cl. at 323 (“[T]he public has a strong interest in preserving the integrity of the procurement process.”) (citing Parcel 49C Ltd. P’ship v. United States, 31 F.3d 1147 , 1153 (Fed. Cir. 1994)); Am. Safety Council, Inc. v. United States, 122 Fed. Cl. 426 , 444 (2015) (holding that “the public interest will be served by an injunction by preserving the integrity of the procurement process”); Applied Bus. Mgmt. Sol., Inc., LLC v. United States, 117 Fed. Cl. 589 , 608 (2014); BINL, Inc. v. United States, 106 Fed. Cl. at 49 (“With regard to the public interest, it is well-settled that there is a public interest in remedying 75 violations of law.”). An important public interest is served through conducting “honest, open, and fair competition” under the FAR, because such competition improves the overall value delivered to the government in the long term. See CW Gov’t Travel, Inc. v. United States, 110 Fed. Cl. at 495. “[T]he public interest is served by injunctive relief where the court has concluded that the government violated an applicable regulation and related provisions in the solicitation, and ‘maintenance of the integrity of the procurement process weighs heavily in favor of granting a permanent injunction.’” Q Integrated Cos. LLC v. United States, 126 Fed. Cl. 124 , 147 (2016) (quoting Springfield Parcel C, LLC v. United States, 124 Fed. Cl. 163 , 193 (2015)). MCS argued that it is in the public interest to grant protestor’s injunctive relief “[b]ecause the Agency’s evaluations in the present procurement did not conform to the requirements of the FAR or Solicitation.” As the court has found that the USDA’s improper evaluation of ISN’s proposal was arbitrary and capricious, the court finds that it was in the public interest to enjoin the agency from continuing with contract performance with ISN. On balance, the injunctive factors weighed in favor of protestor and in favor of granting an injunction of ISN’s performance of the contract with the USDA. CONCLUSION As described above, based on the urgency described by the defendant, and as indicated to the parties previously in an oral decision, the court found that the agency’s actions were arbitrary and capricious and protestor’s motion for injunctive relief was orally granted, effective immediately. Defendant’s motion for judgment on the Administrative Record was denied.15 The Clerk of the Court shall enter JUDGMENT consistent with this Opinion. IT IS SO ORDERED. s/Marian Blank Horn MARIAN BLANK HORN Judge 15 The parties, however, requested a written memorialization of the decision, which is reflected above. 76

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https://www.tncourts.gov/sites/default/files/john_raymond_kautz_v._doris_diane_kautz_berberich.pdf

03/18/2021 IN THE COURT OF APPEALS OF TENNESSEE AT KNOXVILLE December 1, 2020 Session JOHN RAYMOND KAUTZ v. DORIS DIANE KAUTZ BERBERICH Appeal from the Circuit Court for Polk County No. CV-11-059 J. Michael Sharp, Judge No. E2019-00796-COA-R3-CV This appeal concerns a divorce. John Raymond Kautz (“Husband”) sued Doris Diane Kautz Berberich (“Wife”) for divorce in the Circuit Court for Polk County (“the Trial Court”). The parties entered into a marital dissolution agreement (“the MDA”), which the Trial Court approved in its final decree of divorce. Some years later, Wife filed a petition pursuant to Tenn. R. Civ. P. 60.02 seeking relief from the judgment on grounds that Husband failed to disclose certain assets. The Trial Court granted Wife’s motion. However, after a subsequent hearing, the Trial Court found that while Husband later hinted to Wife he had more assets than he disclosed, he actually had not concealed any valuable assets not already known to Wife. The Trial Court reinstated the MDA with certain amendments. Wife appeals. We decline to re-evaluate the Trial Court’s implicit credibility determinations, and the evidence does not preponderate against the Trial Court’s finding that Wife was aware of the valuable marital assets at the time the MDA was executed. We affirm. Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Circuit Court Affirmed; Case Remanded D. MICHAEL SWINEY, C.J., delivered the opinion of the court, in which ANDY D. BENNETT and THOMAS R. FRIERSON, II, JJ., joined. Philip M. Jacobs, Cleveland, Tennessee, for the appellant, Doris Diane Kautz Berberich. Laura M. Crawford, Ducktown, Tennessee, for the appellee, John Raymond Kautz.  OPINION Background In June 1996, Husband and Wife got married in Indiana. No children were born of the marriage. Husband was a money manager who worked for Morgan Stanley and Wife was a schoolteacher. In 2007, Wife filed a complaint for divorce, which later was dismissed when the parties reconciled. A postnuptial agreement was executed as a result. In April 2011, Husband filed a complaint for divorce of his own in the Trial Court. In January 2012, following mediation, the parties agreed on a division of marital property; the MDA was executed toward that end. Both parties were represented by counsel in this process. In March 2012, the Trial Court entered a final decree of divorce based upon the ground of irreconcilable differences and incorporating the MDA. The MDA included the following provision regarding the parties’ retirement accounts: 11. WAIVERS OF ALL CLAIMS AGAINST ASSETS OF THE PARTIES: Except as herein otherwise provided, each party may dispose of his or her property in any way, and each party hereby waives and relinquishes any and all rights which he or she may now have or may hereafter acquire under the present or future pensions, Individual Retirement Accounts, bank accounts, stocks, bonds, and any and all other property or assets which the other presently owned or may hereinafter acquire, and each party hereby waives and relinquishes all rights he or she may now have or hereafter acquire under the present or future laws of any jurisdiction, to share in the marital relationship, including without limitation dower, homestead, courtesy, statutory allowances, widow’s allowances, right to pay an intestacy, right to take against the will of the other, the right to act as administrator or executor of the other’s estate, and each party will at the request of the other, execute, acknowledge, and deliver any and all instruments which may be necessary or advisable to carry into effect this mutual waiver and relinquishment of all such interest, rights and claims. In May 2012, Wife filed a petition for criminal and civil contempt against Husband with respect to the sale of the marital residence. In September 2013, the Trial Court entered an agreed order whereby Husband was to pay Wife $160,000 for her interest in the marital residence. Ostensibly, the divorce was over. In March 2016 the matter revived, as Wife filed a petition pursuant to Tenn. R. Civ. P. 60.02 alleging Husband failed to disclose certain lottery winnings and requesting that the MDA be set aside. The basis for Wife’s claim about lottery winnings was a highly -2- antagonistic email sent to her by Husband back on March 19, 2012 wherein he stated, in part: A friend at Dean Witter years ago had a poster that proclaimed “Living well is the best revenge!” How true. So you enjoy your one-bedroom apartment, your sub-zero wind chills and your stolen money while your precious belongings gather dust in storage. Meanwhile, I’ll be enjoying my lakefront dream home, my bachelorhood and my lottery winnings while your face fades in my rear-view mirror! Have a great life. In October 2016, Wife filed a motion to amend her Rule 60.02 petition to allege that Husband also failed to disclose other marital assets, including a retirement account. The matter was heard in June 2017. Wife, then age 70, and Husband, then age 75, testified. Wife testified to the marital assets she contended Husband failed to disclose: A. In this process I found that there was a BB&T account while we were married that I did not know about. There are retirement account or accounts that I did not know about. I did not know the value of his -- the one that I did know about I didn’t know the value of. He admitted that he took money from a life insurance policy that at that time I was the beneficiary of. He took $6,000 out of that, the cash in that policy. I found that he lied on his 2011 taxes. We were married but separated. I filed married but separated; he filed single. He lied in deposition about how he settled with me on that $160,000. I believed that he had refinanced the house. He mentioned in deposition that the money came from the sale of his now wife’s house, which actually didn’t sell until 14 months after he settled with me. So again, that’s another lie. The information that he supplied was not complete. There was no information about how utilities, mortgage, improvements to the house, cars, boats, and things like that were paid for. *** Q. (By Mr. Jacobs) How much was deposited in the UBS account on or about April 11th of 2013? A. $311,415.25. Q. Were you aware there was a UBS account, an IRA? A. Yes, sir. -3-  Q. Did you know the value of that account? A. No, sir. Q. Did you know about a Northern Trust account? A. Never. Q. Did you know about a Morgan Stanley account? A. No, sir. *** Q. While I’m up here, did you know anything about any rental real estate or partnerships that he had? A. I believe that was, and I think the name of it is Everest Ridgewood or Ridgewood Everest, I’m not sure, I knew about it. Q. Is there any mention of that company or interest in that company in your marital dissolution agreement? A. No, sir. *** Q. He has stated that his only lottery winnings was on December 28th of 2011 of three dollars. Do you believe that to be accurate? A. I can’t tell if he won three dollars on December 28, 2011. That’s what he stated in deposition. I can’t prove that or not prove it. Q. Do you believe that’s the extent of his lottery winnings? A. No, sir. Husband, for his part, testified that he only won three dollars in the lottery. Husband stated that “[i]n that e-mail, as I said previously, I was referring simply to the ironic fact that I had won a big three dollars on the 28th of December.” When pressed on Wife’s allegations that he concealed the existence or value of certain marital assets, Husband testified: Q. Do you have any proof to offer to the Court today you disclosed to Ms. Berberich or any of her agents what was in your 401(k), IRAs, or pensions at the time of your divorce? A. Well, she certainly knew what was in the 401(k) and we got a statement every year on the pension plan that showed the additional $300,000. She was well aware of it for years. Q. Do you have any proof of that? A. I don’t know how I would prove it. -4-  Q. Do you have any correspondence from Mr. Painter to Mr. Brown that says, These are the assets of the parties and this is how they should be equitably divided? A. The only thing I recall there is as we said, that we read earlier, that we agreed her pension was hers and my pension was mine, period. In September 2017, the Trial Court entered an order finding that Wife was entitled to relief under Rule 60.02. The Trial Court found that Husband “fraudulently and intentionally failed to disclose all of his financial assets prior to the execution of the MDA and all subsequent settlement agreements.” The Trial Court, setting aside the MDA as it related to the division of marital assets, stated that “[t]he parties shall submit to the court for further proceedings to allow the court to make an equitable division of all of the undisclosed assets that existed at the time of the final divorce decree and MDA.” The Trial Court also awarded Wife her attorney’s fees. A hearing was conducted in April 2018. The record contains no transcript from that hearing. However, the record does contain a Statement of Evidence. According to the Statement, Wife’s proof included the following: 1. The real property had a value of $320,000.00. 2. Based on the financial statements of the accounts from the date of the parties divorce, the financial/retirement accounts between the parties had the following values: a. Husband’s IRA at UBS was $334,343.26. b. Husband’s IRA at Northern Trust was valued at $365,654.00. c. Wife’s IRA had a [marital] value of $23,180.00, the remaining value of the asset is Wife’s separate property. The total value of the Wife’s IRA as the date of the divorce was approximately $122,000.00. This asset was accumulated during the 30 years the Wife was employed in the State of Indiana. The Wife was married to Husband for 5 of those years or 19.35%. 3. Wife testified that she did not know the value of Husband’s BB&T account, Community Bank account, Southern Bank account or United Community Bank account. *** 10. The Wife testified that she had a liability on her tax refund resulting from failure of the parties to file a joint tax return and the Husband filing an individual tax return and claiming to be divorced in the amount of $1,925.00. -5-  11. The total disclosed assets following the June 30, 2017, hearing had a value of $1,101,488.26 excluding Wife’s pension. *** 15. The marital estate that was awarded to Wife pursuant to the marital dissolution agreement was as follows: a. One-half interest in the real property at a value of $160,000.00 to Wife. b. A vehicle valued at $2,000.00. c. Financial accounts valued at $23,180.00 excluding the value of her pension. d. Personal property valued at $4,930.00. e. Liabilities of the following: Piano ($3,552.75), jukebox ($2,897.47) and tax refund ($1,925.00) for total liabilities of (8,375.22). 16. Wife’s net marital estate had a value of $181,734.78 excluding the value of her pension, and the Wife had separate property of $104,181.00. 17. The marital estate awarded to Husband pursuant to the [Marital] Dissolution Agreement and based on the discovered assets was as follows: a. One half interest in the Real property value of $160,000.00 to Husband. b. Personal property valued at $14,510.00. c. Vehicle $2,000.00. d. Financial accounts $334,343.26 in his IRA at UBS and $365,654.00 in an IRA at Northern Trust. e. The Husband had no liabilities. f. A tax refund for 2011 of $3,871.00. g. Husband has cash value in a life insurance policy in the amount of $31,000.00. 18. The net marital estate that Husband received was $907,507.26. 19. The Husband did have separate property in his two different pensions or financial accounts. The Husband received 82.4% percentage of the actual [marital] Estate. 20. The business interest/real estate partnership owned by Husband was acquired before the parties marriage and is separate property or his separate liability. 21. The Wife through her exhibit and testimony went on to pray for a division of the assets that was an award of the [marital] estate, 60 percent awarded to her and 40 percent of [marital] estate to Husband and requested $470,782.96 from Husband’s two financial accounts with UBS, one of which -6-  was formerly with Northern Trust, to create an equitable division of the [marital] estate. Husband also testified at the April 2018 hearing. According to the Statement, Husband denied that Wife had been unaware of any marital assets: 22. Mrs. Berberich was fully aware of the marital assets at the time of the negotiation of the Marital Dissolution Agreement. 23. That assets that Mrs. Berberich claims were not disclosed, such as an account with BB&T and Northern [T]rust Company, did not exist [at] the time of the divorce. 24. The BB&T was created at the time of the parties’ separation in 2007 and was closed upon the parties’ reconciliation that same year and monies left in that account at that time were deposited back into the parties joint UBS account. 25. The BB&T account did not exist at the time of the parties’ divorce action in 2012. 26. I did not have any kind of financial account with Northern Trust Company, but rather Northern Trust Company was the administrator of his Morgan Stanley Pension Plan. 27. I did not receive any substantial lottery winnings prior to divorce. 28. Mrs. Berberich was aware of my retirement benefits from Morgan Stanley which I thought she waived any marital interest pursuant to the Marital Dissolution Agreement and previously in the Postnuptial Agreement executed on July 9, 2007, both times having been represented by counsel. 29. Full disclosure of the assets were made during the negotiation of both of those agreements. 30. I believed each party would retain all rights to their own retirement. In June 2018, the Trial Court entered its Order Regarding Post Divorce Issues. In sum, the Trial Court found that, while Husband had insinuated to Wife he concealed certain marital assets of value from her, in reality, he had not. In its order, the Trial Court stated: Based upon all of the proof, now before the court, regarding the extent of the parties’ assets on the date that the parties entered into the initial marital dissolution agreement (MDA), entered on March 19, 2012, and their subsequent settlement agreement entered on 9/6/2013, the court finds that there was no substantial or substantive asset that Mr. Kautz owned or had possession or control of that Ms. Kautz Berberich was not actually aware of at the time. However, due to statements made by Mr. Kautz and/or the -7- actions of Mr. Kautz, which apparently was due to his anger and/or his animosity toward Ms. Kautz Berberich, Mr. Kautz created the distinct impression that he had substantial other assets. Specifically, Mr. Kautz made reference to his lottery winnings. Furthermore, Ms. Kautz Berberich became aware of a real estate partnership that Mr. Kautz is a partner in with what now appears to be multiple other individuals. The reality is, based upon all of the proof now before the court, that the real estate partnership has a negative equity value of about $96,000.00 that Mr. Kautz is responsible for. Had this information been made known to Ms. Kautz Berberich at the time of the marital dissolution agreement, then some if not all of this extended litigation could have, and should have been, avoided. The same is true with regard to any actual lottery winnings, there is no credible proof before the court that the lottery winnings were substantial, nor much of anything, however, due to statements made by Mr. Kautz to Ms. Kautz Berberich, the appearance was given to Ms. Kautz Berberich that there was possibly a failure to disclose what was a substantial asset. With regard to the BB&T and the Northern Trust Company accounts, the proof is that Mr. Kautz failed to disclose that the BB&T account that was created at the time of the parties’ separation in 2007 was in fact closed upon the parties’ reconciliation later that same year, and that monies left in that account at that time were then deposited back into the parties’ joint UBS account. Had that full disclosure been made, again, some or all of this litigation could and should have been avoided. Ultimately, the court finds that Mr. Kautz did not make full disclosure of all of the assets and/or the asset trail that would have avoided this litigation. In fact, the court finds that for reasons known only to Mr. Kautz, he appeared to lead and possibly even goad Ms. Kautz Berberich into believing that there were other greater assets that he owned and/or had possession of, and that she was losing out on certain assets. It now appears, based upon the further proof, that there were no real substantial or other additional assets. In fact, it appears that the real estate partnership is a liability instead of an asset. It further appears that whatever lottery winnings there were were minimal, and in fact Ms. Kautz Berberich was not able to offer any credible proof that there were any lottery winnings of any substance. The court finds that it is very unfortunate that these parties are back before the court based upon such an apparent animosity between each other that they continue to litigate what should have been fully and completely settled by [their] settlement agreement executed 9/26/2013. Based upon all of the above, the court amends it’s Final Order reinstating the marital dissolution agreement because there were no real assets of any substance that actually existed. However, given the statements -8-  and actions of Mr. Kautz, Ms. Kautz Berberich had every reason to believe that there might be substantial assets, given the representations made by Mr. Kautz. The MDA is also amended to provide that Mr. Kautz’s actions in filing the tax return as a single person were in fact fraudulent in that he was not a single person. The court finds that the tax returns should have been filed jointly, and therefore that return should be amended and filed jointly based upon the parties’ marital status and apparent agreement at that time. Finally, with regard to attorney fees, the court finds that this litigation would not have been made necessary but for the failure to properly and truthfully disclose all of his assets and/or holdings to Ms. Kautz Berberich at the time of the parties’ settlement agreement. Because of that, Ms. Kautz Berberich was under the mistaken belief that there were likely other substantial assets and/or accounts that existed at the time of the parties’ MDA that were not properly disclosed to her nor to the court. The court believed the same thing based upon the proof before the court in September of 2017. Now, the court finds that in actuality this reasoning was based upon false or misleading statements made by Mr. Kautz to Ms. Kautz Berberich in an apparent attempt to antagonize her or for other reasons. Nevertheless, the court finds that due to Mr. Kautz’s false statements and/or misrepresentations, Ms. Kautz Berberich is entitled to her attorney fees and costs in this matter. Otherwise, except as set out herein, the MDA is reinstated except as amended herein. In July 2018, Wife filed a motion to alter or amend. In February 2019, the Trial Court entered an order denying Wife’s motion. In its order, the Trial Court stated: In this court’s order of June 25, 2018, the court noted that with regard to the BB&T and the Northern Trust Company accounts, the account created at the time of the separation was in fact closed upon the parties’ reconciliation later that same year. The court found that all of the monies left in that account at that time were then deposited back into the parties’ joint UBS account. Based upon this, the court finds that Ms. Berberich had full disclosure of all of Mr. Kautz’s financial assets, even though the court understands, based upon Mr. Kautz’s statements regarding his other various accounts and assets, why Ms. Berberich believed that she did not have full disclosure. After having considered all of the evidence that Ms. Berberich offered to the court in this court’s re-hearing, after having given her the opportunity to present any and all evidence that she had pertaining to all of the parties’ marital assets, including but not limited to, the IRA with Morgan Stanley, as well as any JP Morgan Chase accounts, UBS accounts and BB&T accounts, the court finds -9-  that there has been no evidence presented to the court that Ms. Berberich did not have knowledge of all of the assets as well as knowledge of the extent of all of Mr. Kautz’s accounts and assets. After a further, thorough review of all the evidence before the court in this matter, the court respectfully denies the motion to alter or amend, with the exception that the court finds, subject to the mandates of it’s order, that the end result of the MDA that the court reinstated was, and is, a fair and equitable division of the parties’ marital assets. The court finds that there are no further undisclosed financial accounts of Mr. Kautz that Ms. Berberich has offered this court any proof or evidence of. The court finds that the division of assets contained in the reinstated marital dissolution agreement (MDA) is an equitable division pursuant to T.C.A. §36-4-121. Otherwise, this court respectfully denies the petitioner’s motion to alter or amend, and in all respects reaffirms it’s previous order. This is a final order. Due to an issue with service, the February 2019 order was re-entered as a final order in May 2019. Wife timely appealed from that order. The Trial Court also entered an award of attorney’s fees and discretionary costs to Wife in the amount of $15,518.25. Discussion We restate and consolidate Wife’s three issues on appeal into the following two dispositive issues: 1) whether the Trial Court erred in reinstating the MDA, as amended, despite having found earlier that Husband fraudulently and intentionally failed to disclose all of his financial assets; and, 2) whether the Trial Court erred in reinstating the MDA when it resulted in an inherently inequitable division of the marital estate. In their briefs’ conclusions, both parties attempt to raise the issue of whether they should be granted an award of attorney’s fees. Our review is de novo upon the record, accompanied by a presumption of correctness of the findings of fact of the trial court, unless the preponderance of the evidence is otherwise. Tenn. R. App. P. 13(d); Bogan v. Bogan, 60 S.W.3d 721 , 727 (Tenn. 2001). A trial court’s conclusions of law are subject to a de novo review with no presumption of correctness. S. Constructors, Inc. v. Loudon County Bd. of Educ., 58 S.W.3d 706 , 710 (Tenn. 2001). Regarding witness credibility, our Supreme Court has stated: When it comes to live, in-court witnesses, appellate courts should afford trial courts considerable deference when reviewing issues that hinge on the witnesses’ credibility because trial courts are “uniquely positioned to observe the demeanor and conduct of witnesses.” State v. Binette, 33 S.W.3d -10-  215, 217 (Tenn. 2000). “[A]ppellate courts will not re-evaluate a trial judge’s assessment of witness credibility absent clear and convincing evidence to the contrary.” Wells v. Tennessee Bd. of Regents, 9 S.W.3d 779 , 783 (Tenn. 1999); see also Hughes v. Metro. Gov’t of Nashville & Davidson Cnty., 340 S.W.3d 352 , 360 (Tenn. 2011). In order for evidence to be clear and convincing, it must eliminate any “serious or substantial doubt about the correctness of the conclusions drawn from the evidence.” State v. Sexton, 368 S.W.3d 371 , 404 (Tenn. 2012) (quoting Grindstaff v. State, 297 S.W.3d 208 , 221 (Tenn. 2009)). Whether the evidence is clear and convincing is a question of law that appellate courts review de novo without a presumption of correctness. Reid ex rel. Martiniano v. State, 396 S.W.3d 478 , 515 (Tenn. 2013), (citing In re Bernard T., 319 S.W.3d 586 , 596-97 (Tenn. 2010)), cert. denied, ––– U.S. ––––, 134 S.Ct. 224 , 187 L.Ed.2d 167 (2013). Kelly v. Kelly, 445 S.W.3d 685 , 692-93 (Tenn. 2014). We first address whether the Trial Court erred in reinstating the MDA, as amended, despite having found earlier that Husband fraudulently and intentionally failed to disclose all of his financial assets. In particular, Wife states that the Trial Court failed to account for $600,000 in marital retirement accounts for which there was no specific provision in the MDA, the result being a highly inequitable division of marital assets. According to the Statement of Evidence, Husband testified among other things at the April 2018 hearing that Wife was fully aware of the marital assets at the time the MDA was negotiated. This implicates whether Husband’s testimony was credible, and we extend strong deference to a trial court’s determination of witness credibility. Wife argues, however, that since the Trial Court did not make any specific credibility determination, its conclusion is not entitled to any deference on that basis. It certainly is preferable for trial courts to make explicit credibility determinations, lest there be any ambiguity. Nevertheless, from time to time, this Court has acknowledged implicit credibility determinations. See, e.g., In re H.S., No. M2019-00808-COA-R3-PT, 2020 WL 1428777 , at *9 (Tenn. Ct. App. Mar. 20, 2020), no appl. perm. appeal filed; In re Wyatt S., No. E2012-00539-COA-R3-JV, 2012 WL 5482215 , at *9 (Tenn. Ct. App. Nov. 13, 2012), no appl. perm. appeal filed; Taylor v. McKinnie, No. W2007-01468-COA-R3-JV, 2008 WL 2971767 , at *4 (Tenn. Ct. App. Aug. 5, 2008), no appl. perm. appeal filed. To illustrate, if party (A) testified to (X), and party (B) testified to contrasting account (Y), and the trial court’s order reflects that it believed (Y) to be the case, then one can discern that the trial court credited party (B)’s testimony rather than party (A)’s even if the court failed to make an explicit credibility determination. Here, the Trial Court implicitly credited Husband’s testimony at the April 2018 hearing notwithstanding its finding that Husband goaded Wife into believing he concealed certain valuable assets. In any event, in view of the outcome, the Trial Court plainly did not credit Wife’s testimony. We will not overturn a trial court’s credibility determination—be it -11- implicit or explicit—absent clear and convincing evidence to the contrary. We find no such clear and convincing evidence in this record. Beyond the matter of the marital retirement accounts, the Trial Court found further that Husband’s lottery winnings were of a trivial amount and his real estate partnership actually had a negative value. The Trial Court also found “that there has been no evidence presented to the court that Ms. Berberich did not have knowledge of all of the assets as well as knowledge of the extent of all of Mr. Kautz’s accounts and assets.” The evidence does not preponderate against the Trial Court’s factual findings, and we discern no reversible error on this issue. We next address whether the Trial Court erred in reinstating the MDA when it resulted in an inherently inequitable division of the marital estate. Wife cites to Tenn. Code Ann. § 36-4-103 (b), which pertains to divorces granted on the ground of irreconcilable differences such as the divorce of this case: (b) No divorce shall be granted on the ground of irreconcilable differences unless the court affirmatively finds in its decree that the parties have made adequate and sufficient provision by written agreement for the custody and maintenance of any children of that marriage and for the equitable settlement of any property rights between the parties. If the court does not affirmatively find that the agreement is sufficient or equitable, the cause shall be continued by the court to allow further disposition by the petitioner. If both parties are present at the hearing, they may, at that time, ratify any amendments the court may have to the agreement. The amended agreement shall then become a part of the decree. The agreement shall be incorporated in the decree or incorporated by reference, and such decree may be modified as other decrees for divorce. Tenn. Code Ann. § 36-4-103 (b) (2017). According to Wife, the Trial Court had an obligation to ensure that the division of marital assets in the MDA was equitable. Wife asserts, and Husband does not dispute on appeal, that the MDA resulted in a roughly 82/18 division of marital assets in favor of Husband. In its order denying Wife’s motion to alter or amend, the Trial Court explicitly found that the MDA, as amended, represented a fair and equitable division of property. However, more to the point, this current round of post- divorce litigation with these parties stemmed from Wife’s Rule 60.02 petition alleging failure to disclose on Husband’s part. The success of Wife’s Rule 60.02 petition to set aside the MDA years after entry of the final decree of divorce hinged not upon whether it was an equitable division but could she prove, ultimately, that she lacked the benefit of full disclosure when the MDA was executed. Having failed to prove that, Wife is left to argue that the MDA was extremely unfair to her. Wife is seeking, long after the divorce was -12- final, an agreement more favorable to her (at the April 2018 hearing, Wife requested a 60/40 division of assets in her favor) than the one she freely and knowledgably entered into with the aid of counsel in 2012 (which apparently resulted in an 82/18 division in favor of Husband)—a “do-over,” if one will. That is not a proper basis for Rule 60.02 relief. See Higdon v. Higdon, No. M2019-02281-COA-R3-CV, 2020 WL 6336151 , at *7 (Tenn. Ct. App. Oct. 29, 2020), no appl. perm. appeal filed (“The parties agreed to a settlement, and it was duly entered. We decline Wife’s request to re-open via a Rule 60.02 motion the division of the marital estate on the basis of alleged inequitableness.”). We discern no reversible error in the Trial Court’s declining to order a new division of the marital estate. The final matter we address is that of attorney’s fees. The Trial Court awarded Wife her attorney’s fees below on grounds that Husband’s misleading statements to Wife sparked this litigation. On appeal, both parties request an award of attorney’s fees. Neither party identifies this request as a distinct issue; they simply ask for attorney’s fees in their brief’s conclusion almost as if in passing. “Courts have consistently held that issues must be included in the Statement of Issues Presented for Review required by Tennessee Rules of Appellate Procedure 27(a)(4). An issue not included is not properly before the Court of Appeals.” Hawkins v. Hart, 86 S.W.3d 522 , 531 (Tenn. Ct. App. 2001). This would-be issue is waived. We decline to grant an award of attorney’s fees to either party. The judgment of the Trial Court is affirmed in all respects. Conclusion The judgment of the Trial Court is affirmed, and this cause is remanded to the Trial Court for collection of the costs below. The costs on appeal are assessed against the Appellant, Doris Diane Kautz Berberich, and her surety, if any. s/ D. Michael Swiney ______ D. MICHAEL SWINEY, CHIEF JUDGE -13-

2020-12-02 07:14:31.845597+00

http://www.search.txcourts.gov/RetrieveDocument.aspx?DocId=16781&Index=%5c%5c10%2e20%2e4%2e7%5cTamesIndexes%5ccoa05%5cOpinion

Concurring In Part and Dissenting In Part; Opinion Filed November 30, 2020 In The Court of Appeals Fifth District of Texas at Dallas No. 05-18-00167-CV SARAH GREGORY AND NEW PRIME, INC., Appellants V. JASWINDER CHOHAN, INDIVIDUALLY AND AS NEXT FRIEND AND NATURAL MOTHER OF G.K.D., H.S.D., AND A.D., MINORS, AND AS REPRESENTATIVE OF THE ESTATE OF BHUPINDER SINGH DEOL, DARSHAN SINGH DEOL, JAGTAR KAUR DEOL, GUILLERMO VASQUEZ, WILLIAM VASQUEZ, INDIVIDUALLY AND AS ADMINISTRATOR OF THE ESTATE OF ALMA B. (“BELINDA”) VASQUEZ, ALMA J. PERALES, INDIVIDUALLY AND AS ADMINISTRATOR OF THE ESTATE OF HECTOR PERALES AND AS NEXT FRIEND OF MINOR N.P., Appellees On Appeal from the County Court at Law No. 5 Dallas County, Texas Trial Court Cause No. CC-15-02925-E OPINION CONCURRING IN PART AND DISSENTING IN PART TO THE COURT’S OPINION Before the Court sitting En Banc Concurring and Dissenting Opinion by Justice Schenck I join Parts I through VII and IX of the majority opinion that I drafted as the panel opinion prior to the Court deciding to consider this case en banc. However, I respectfully dissent from Part VIII of the majority opinion in which the majority resolves Gregory and New Prime’s challenge of the non-economic damages awarded to the Deol family members because, in doing so, the majority misapplies, or wholly fails to apply, the factual sufficiency standard of review. More particularly, the majority fails to conduct a “meaningful evidentiary review” of the mental anguish and loss of companionship damage awards as required by Texas Supreme Court precedent. See Saenz v. Fidelity & Guar. Ins. Underwriters, 925 S.W.2d 607 , 614 (Tex. 1996). I. To summarize, I differ from the majority in the standards that govern the amount of mental anguish awards in a case such as this where (1) there has been no effort to present evidence augmented by proper legal argument or admissible opinion testimony that would direct the factfinder to a “fair and reasonable” number and (2) there has been obviously improper argument urging the jury to disregard the compensatory purpose of its award in order to “send a message” with its number. As I indicated in what is now the majority opinion, while it is a close question, I do not believe that this improper argument mandates reversal on its own account. Instead, I believe we are obliged to look for other evidentiary support for the award and to affirm the award if, using the proper burden of proof and standards of review, we can do so. That obligation requires us to examine both legal and factual sufficiency and, I believe, permits us to employ objective measures, including –2– looking to awards in like cases both to support1 the award and to assess potential excessiveness. In my view, the majority misses the mark by affirming the awards simply because the jury heard Jaswinder Chohan’s testimony concerning the family members’ relationships with Deol and that they are understandably deeply saddened by his death. I agree that this evidence is sufficient to establish the fact of the emotional injury and the entitlement to pursue some amount of damages; it is not, however, also a priori assumption that the evidence is factually sufficient to support the award of any amount that would not “shock the judicial conscience,” whatever that might mean. Conflating evidence of the existence of an injury with its quantification ignores that two distinct and critical questions are involved in the trial court, as the Texas Supreme Court has repeatedly stressed. See, e.g. , id. Likewise, deferring to any number so derived so long as it does not “shock the conscience” is not the “meaningful” evidentiary review the supreme court has insisted upon in these cases. It is, instead, a retrenchment to the rejected doctrine that such awards are inherently arbitrary, leaving both the claim and the resulting award needlessly open to attacks, such as the due process claim Gregory and New Prime raise here. Instead, I believe that we can, and should, strive to apply more objective and manageable 1 While cases have typically looked at like awards for proof of excessiveness, if we are to conclude that proof of a close familial relation is enough to presume some mental injury to avoid a legal insufficiency challenge, like cases might also be relevant to determine whether the jury was within its lawful discretion in choosing a particular amount. –3– standards at both the trial and appellate levels that the supreme court has recognized and applied over the past decades. Insofar as legal sufficiency is concerned, I believe that the Texas Supreme Court’s decision in Moore v. Lillebo supports the argument that evidence of a close familial bond is sufficient in its own right to support the existence of some compensable injury, if not its amount. 722 S.W.2d 683 , 685 (Tex. 1986).2 As a result, barring any further evidence of the amount, we would be obliged to avoid a reversal and rendition and should, instead, move on to consider factual sufficiency, which Gregory and New Prime also challenge. But, as to factual sufficiency, the evidence at trial must be tied in some non- arbitrary fashion to the jury’s award, and our review of it must be “meaningful.” Saenz, 925 S.W.2d at 614 . This is not only a plain directive by Saenz and other controlling cases, I believe it is essential to the continued recognition of the claim as against modern due process standards or a re-evaluation of the common law that initially refused to recognize it for the reasons I articulate herein. Arguments to the effect the jury “heard the evidence” and received a written charge warning against passion is a truism in this and every other case. If countenanced as enough in its 2 I concede that Moore is neither recent nor as clear as one might like in this respect, as Justice Whitehill observes. As discussed below, if I read Moore correctly, I believe a better alternative may be to accept it as not only embracing proof of some amount of damage, but an amount up to a presumed floor in keeping with more broadly acknowledged understanding of the presumed injury. What I do not accept as consistent with Saenz and its progeny or the due process clause is that proof of any injury translates into adequate proof of any amount. –4– own right this would amount to allowing the jury to “pick a number and put it in the blank,” something it is not permitted to do. Id. Accepting the number so yielded by that process, with the declaration that our “conscience” is not “shocked,” affords no review. Worse, the complete lack of articulable, objective standards makes it impossible for parties to mediate their claims in advance of trial or direct their arguments in a court and further subjects the claim to broader attack. II. I believe an historical overview of mental anguish damages and loss of companionship damages in wrongful death cases is helpful in understanding the current state of the law in this area. Historically, courts distrusted claims of mental anguish or mental suffering. Parkway Co. v. Woodruff, 901 S.W.2d 434 , 442 (Tex. 1995). In fact, at first, the common law, in Texas and elsewhere, refused to acknowledge mental or emotional harm as a compensable loss at all. Lynch v. Knight, 11 Eng. Rep. 854, 863 (1861). It did so because mental anguish is inherently subjective and claims of mental anguish do not readily lend themselves to judicial management to avoid arbitrary deprivations of the answering defendant’s rights. See, e.g., Parkway, 901 S.W.2d at 442 . Nevertheless, over time, in keeping with growing empirical and scientific proof, courts came to recognize mental anguish as not only a real phenomenon but as a legally cognizable damage in its own right, crafting exceptions to the categorical ban on recovery along the way. Id. Acknowledging that the existence of mental –5– anguish is less readily verifiable than other, physical injuries, mental anguish damages were initially limited to cases in which there was a physical injury. See Hill v. Kimball, 13 S.W. 59 , 59 (Tex. 1890). Then, compensation for mental anguish unaccompanied by a physical impact injury was allowed provided the mental anguish had “a physical manifestation.” See id.; see also Gulf, C. & S.F. Ry. Co. v. Hayter, 54 S.W. 944 , 945 (Tex. 1900). The physical impact rule was eased further with the Texas Supreme Court adopting the “zone of danger” theory of bystander recovery from Dillon v. Legg.3 Eventually, the requirement of an actual physical injury or near injury was abandoned at common law in this narrow, statutory setting to allow wrongful death claimants to recover mental anguish damages without any physical injury or proximity to the events, though initially only on behalf of a parent for the loss of a minor child. See Freeman v. City of Pasadena, 744 S.W.2d 923 , 923–24 (Tex. 1988); Sanchez v. Schindler, 651 S.W.2d 249 , 253 (Tex. 1983).4 I fear that we may forget too easily how close and controversial these latter decisions were. E.g., Sanchez, 651 S.W.2d at 253 (Pope, C.J., dissenting joined by McGee and Barrow, JJ.). And, likewise, how important the subsequent supreme 3 Dillon v. Legg, 441 P.2d 912 , 920 (Cal. 1968). 4 At the same time the Texas Supreme Court abolished the ban on mental anguish damages in wrongful death cases, it also acknowledged loss of companionship damages in wrongful death cases. See Sanchez, 651 S.W.2d at 253 . –6– court decisions concerning the need for objective standards and meaningful review are to sustaining a claim for a loss virtually every human will sustain during his or her life. To this day, other jurisdictions as progressive and enlightened as our own have engaged in the same experiential exercise of refining common law rules and have found the risk of “unmanageable” and totally “unpredictable liability” to outweigh the benefit of recognizing the claim at all in a variety of settings. See, e.g., Guia v. Arakaki, 99 P.3d 1068 (Haw. 2004). In the decades before Sanchez, our own supreme court declined to recognize any claim of emotional distress absent physical impact, no matter how real the injury was, and left the matter to the legislature, expressing the concern that it would “open a wide and dangerous field in which it is difficult, if not impossible, to consistently apply the rule.” Harned v. E-Z Fin. Co., 254 S.W.2d 81 , 86 (Tex. 1953). Sanchez set us on a different and difficult path. Yet, Saenz insists that it does not impose an impossible task. I believe that we can, and must, enforce some standards that do not reopen the claim to the charge that it is inconsistently applied and unpredictable if the experiment is to survive. III. A. Proof of the Existence of Mental Anguish Is Distinct From Proof Quantifying Its Extent In 1995, the Texas Supreme Court set forth the specific type of evidence a claimant must present to establish the existence of compensable mental anguish. –7–  Parkway, 901 S.W.2d at 444 . More particularly, the supreme court stated mental anguish damages could not be awarded unless there was (1) direct evidence of the nature, duration, or severity of the plaintiff’s anguish, thus establishing a substantial disruption in the plaintiff’s daily routine or (2) other evidence showing that the plaintiff suffered from a high degree of mental pain and distress that is more than mere worry, anxiety, vexation, embarrassment, or anger. Id. Evidence of the existence of a compensable injury is not simultaneously evidence of its quantum. Were it otherwise, the notion of nominal damages would not exist. MBM Fin. Corp. v. Woodlands Operating Co., L.P., 292 S.W.3d 660 , 665 (Tex. 2009). Because such nominal damage awards obviously fail to compensate for an established injury, we rightly resist resort to them. Id. at 666. We generally ask, instead, whether the party with the burden of proving the amount has brought “forward the best evidence of the damage of which the situation admits.” Id. (quoting Gulf Coast Inv. Corp. v. Rothman, 506 S.W.2d 856 , 858 (Tex. 1974)). We are willing to affix the label of “actual damages” to damages that are actually shown by that best evidence if it “affords a reasonable basis for estimating [the] loss.” Gulf Coast Inv., 506 S.W.2d at 858 . “Application of the rule” has never meant “that a guess or surmise on the part of the jury would suffice.” Id. Earlier efforts to suggest that emotional awards are inherently arbitrary and somehow exempt from this requirement have already been rejected. Saenz, 925 S.W.2d at 614 (“[W]e disagree with the court of appeals that translating mental anguish into dollars is a necessarily arbitrary process.”). –8– Rather, to support an award of mental anguish damages, “[t]here must be both [1] evidence of the existence of compensable mental anguish and [2] evidence to justify the amount awarded.” Hancock v. Variyam, 400 S.W.3d 59 , 68 (Tex. 2013) (emphasis and enumeration added). Here, Gregory and New Prime concede that the members of the Deol family suffered mental anguish as a result of Deol’s death. On appeal, they challenge the legal and factual sufficiency of the evidence to justify the amounts awarded. 5 They contend that the closing argument adopted by Deol’s counsel urged jurors to punish, rather than compensate, for the injury. I note that the resulting award is quite close to the “amount” so urged. Putting that problem aside for the moment, the evidence before the jury, as I will detail below, showed a close familial relation of a type sufficient, in my view, to support entitlement to some award and to overcome a legal sufficiency bar and the resulting rendition of an adverse judgment. Thus, I would overrule Gregory and New Prime’s legal sufficiency challenge of the mental anguish damages awarded to the Deol family members and proceed to a factual sufficiency review. While the jury heard about a close familial relation, the jury did not hear any evidence of, among other things, the likely duration of the Deol family members’ 5 More particularly, in their supplemental briefing to the Court, Gregory and New Prime clarified that they are claiming the evidence is legally and factually insufficient to support any award for future mental anguish and is factually insufficient to support the awards for past mental anguish and past and future loss of companionship. –9– mental anguish or the need for therapy or other treatment or its costs. It did not have evidence or guidance, in the form of expert opinion or otherwise, concerning whether, among other things, their emotional distress had resulted or might result in a material diminution in quality of life or functioning, a propensity for alcohol or drug abuse, a disruption of relationships, or their ability to seek or hold employment. See, e.g., Atchison, Topeka & Santa Fe Ry. v. Cruz, 9 S.W.3d 173 , 184–85 (Tex. App.—El Paso 1999, pet. granted, judgm’t vacated, remanded by agr.) (appellees’ economist gave the jury guidelines in how damages for intangible elements could be calculated). The jury’s attempt to affix a number in this case was not only misinformed by improper argument, it was little more than guesswork that would be applicable to any case involving the loss of a close family member. I accept that some real loss occurs in every such case and readily accept that some damages can be presumed to follow. But, if any number could be upheld as factually sufficient on this showing, we would move back to the position explicitly rejected in Saenz, making the process “necessarily arbitrary” and compelling us to accept virtually any damage figure in any wrongful death case. B. Common Law Standards I note that in the 30-plus years since the Texas Supreme Court first recognized mental anguish damages in wrongful death cases, and in the years since the supreme court handed down Saenz, with notable exceptions, the high court has given the intermediate appellate courts little guidance to govern its mandate that courts of –10– appeals, as the sole appellate courts addressing factual sufficiency of non-economic damages, conduct a “meaningful review” of them.6 While the majority appears to adhere to prior panel precedent dismissing a comparison of the award in one case to any other like cases as “generally of little or no help,” see U-Haul Int’l, Inc. v. Waldrip, 322 S.W.3d 821 , 855–56 (Tex. App.— Dallas 2010), aff’d in part, rev’d in part on other grounds, 380 S.W.3d 811 (Tex. 2012), I disagree. See Bill Hendrix Auto Parts v. Blackburn, 433 S.W.2d 237 (Tex. App.—Houston [14th Dist.] 1968, no writ).7 The supreme court has recently confirmed that this comparison to like cases is entirely proper. See Anderson v. Durant, 550 S.W.3d 605 , 620 (Tex. 2018). Indeed, at this stage, it appears to be the only expressly approved vehicle we have for lending some measure of objectivity and predictability to mental anguish awards in wrongful death cases. The only other like metric available in other contexts—the ratio between economic and non- economic damages—is ill-suited to this claim because it is brought by the surviving family members, not the decedent whose primary economic loss is captured in a separate claim. 6 Claims for non-economic damages suffer the same infirmities as claims of partisan gerrymandering, which the United States Supreme Court has refrained from addressing because the Constitution contains no legal standards for resolving such claims and are thus not subject to judicial management. See Rucho v. Common Cause, 139 S. Ct. 2484 , 2499 (2019). 7 See also Emerson Elec. v. Johnson, 601 S.W.3d 813 , 845 (Tex. App.—Fort Worth 2018, pet. granted). –11–  Before I briefly note the other strategies developed for judicial management of these awards, I will note that the United State Supreme Court began its foray into the proper due-process-compelled review standards for punitive damages by comparison to the broad discretion juries had in affixing a proper number to compensate for emotional distress. Pac. Mut. Life Ins. V. Haslip, 499 U.S. 1 , 20 (1991). Critical to the court’s original determination that Alabama procedures created “a definite and meaningful constraint” on the amounts juries awarded was that Alabama’s appellate courts were, at least at that point, thought to be engaged in “meaningful and adequate review” by the trial court followed by appellate review having “real effect.” Id. at 20–23. Thereafter, it would appear that the United States Supreme Court’s confidence that state court appellate review actually provided that meaningful constraint against arbitrary awards slipped. The supreme court, as a matter of federal due process, introduced much firmer constraints deemed necessary to assure that any award is “based upon an ‘application of law, rather than a decisionmaker’s caprice.’” E.g., State Farm Mut. Auto. Ins. Co. v. Campbell, 538 U.S. 408 , 418 (2003) (recounting march toward mandatory 3-prong “guideposts,” mandatory de novo appellate review) (internal citation omitted). Other common law jurisdictions have developed other techniques aimed at avoiding arbitrarily excessive awards. As noted, some have simply opted to adhere to our own, pre-1985 common law, banning non-economic damage awards in wrongful death cases. See, e.g., In re Air Crash at Belle Harbor, N. Y. on Nov. 12, –12– 2001, 450 F. Supp. 2d 432 (S.D.N.Y. 2006) (applying New York law). As modern understanding seems to confirm only that mental anguish in these settings is real, if challenging to quantify, I would find other options to support their recognition to be preferable. Congress,8 state legislatures,9 and courts10 have adopted various limits or caps on non-economic damages to lend some predictability and, in some cases, in response to run-away jury verdicts with the limits typically expressed in the hundreds of thousands of dollars. These provisions sometimes operate not so much as absolute caps but as a limited authorization for presumed damages, much like our own Moore decision permits presumption of some quantum of harm. Claimants are still required to show harm, and the awards are scrutinized as such, up to the presumed limit. Claimants are also permitted to prove entitlement to additional amounts that would be supported by proof peculiar to the case, such as aggravating conduct by the defendant. In this way, the rule acknowledges the uncertain nature 8 Title VII claimants, for example, are limited in their recovery of emotional distress, regardless of the extent of their injury, depending on the size of the employer, with maximum recovery being limited to $300,000. 42 U.S.C. § 1981a(b)(3). 9 Many states have imposed hard limits on the recovery of noneconomic damages ranging from $250,000 to $1,000,000. See ALASKA STAT. ANN. § 09-17.010(b) ($400,000 wrongful death); CAL. CIV. CODE. ANN. § 3333.2 ($250,000 medical malpractice); COLO. REV. STAT. § 13-21-102.5 (wrongful death $250,000 with inflation adjustment); IDAHO CODE ANN. § 6-1603(4)(1) ($250,000 wrongful death); MASS. GEN. LAWS ch. 231 § 60H ($500,000 medical malpractice); MD. CODE ANN., CTS. & JUD. PROC. § 11- 108(b)(2) ($500,000 wrongful death); MISS. CODE ANN. § 11-1-60(2)(6) ($1,000,000 wrongful death); ORE. REV. STAT. § 31.710(1) ($500,000 wrongful death); TENN. CODE ANN. § 29-39-102 ($750,000 wrongful death). 10 For example, the Supreme Court of Canada, which adheres to the same common law our constitution embraces, adopted a non-economic damages cap with adjustment for inflation–presently just under $400,000. Andres v. Grand & Toy Alberta Ltd., [1978] 2 S.C. 229 ; Thornton v. District No. 57, [1978] 2 S.C. 267 ; Arnold v. Teno, [1978] 2 S.C. 287 . The rule permits additional damages on proof of aggravating damages. McIntyre v. Grigg, [2006] 83 O.R. 3d 161 (Can. Ont. C.A.). –13– of the injury while obliging the claimant to adduce more meaningful proof as the claim exceeds the upper limits. Cf. Addington v. Tex., 441 U.S. 418 (1979) (discussing proof standards compelled by due process in relation to extent and nature of the interest involved). While the Texas Legislature has not adopted any limit or cap on non-economic damages, the Texas Supreme Court is not bound by the prior legislative inaction in an area like tort law, which has traditionally been developed primarily through the judicial process. Sanchez, 651 S.W.2d at 252 (citing Green, Protection of the Family Under Tort Law, 10 HASTINGS L.J. 237, 245 (1959)). Mental anguish and loss of companionship damages are judicially created remedies, and it is within the supreme court’s authority to adapt or refine the common law it created should it conclude that Saenz and its progeny have not lent the necessary degree of rigor to these awards since 1996. It is said that the genius of the common law is that it evolves slowly in the light of reason and experience. DeSantis v. Wackenhut Corp., 793 S.W.2d 670 , 690 (Tex. 1990) (Mauzy, J., concurring); O.W. Holmes, Jr., THE COMMON LAW 273 (1881) (“The life of the law has not been logic; it has been experience.”).11 In my review of approximately one hundred and fifty cases in which the Texas Supreme Court considered mental anguish damages, in only two of those cases did 11 A limit or cap might be structured to allow the reviewing court, in resolving a factual sufficiency challenge, to defer to the jury’s award provided it falls within the evidence and the capped amount. If the award exceeds the cap, the intermediate appellate court would consider whether extraordinary circumstances support a higher award. –14– the court uphold the damages awarded as supported by legally sufficient evidence. Those awards were of $5,000 and $150,000, respectively in Bennett v. Grant, 525 S.W.3d 642 (Tex. 2017), and Bunton v. Bentley, 153 S.W.3d 50 (Tex. 2004). While I do not believe that the court’s approval of a $150,000 mental anguish award as against legal sufficiency challenges would answer the question as a whole, it comes close to like limits in other jurisdictions and should give pause to an intermediate appellate court charged with conducting “meaningful review” of an award in a case, like this, where the jury was operating with little in the way of guidance. As an intermediate appellate court, our charge is limited to the guidance we have, which at this stage includes only the limited direct evidence and argument offered at trial and comparison to like awards. With that in my mind, I will turn to that task. C. Factual Sufficiency Under Saenz and Anderson When reviewing an assertion that the evidence is factually insufficient to support a finding, we set aside the finding only if, after considering and weighing all of the evidence in the record pertinent to that finding, we determine that the credible evidence supporting the finding is so weak or so contrary to the overwhelming weight of all the evidence that the answer should be set aside and a new trial ordered. Pool v. Ford Motor Co., 715 S.W.2d 629 , 635 (Tex. 1986). Whether damages are excessive and whether a remittitur is appropriate is a factual determination that is final in the court of appeals. Mar. Overseas Corp. v. Ellis, 971 S.W.2d 402 , 407 –15– (Tex. 1998); see also TEX. CONST. art. V, § 6; TEX. GOV’T CODE ANN. § 22.225(a). The nebulous issues of mental anguish and loss of companionship are “inherently somewhat imprecise.” Thomas v. Uzoka, 290 S.W.3d 437 , 454 (Tex. App.—Houston [14th Dist.] 2009, pet. denied). Because these damages are unliquidated and incapable of precise mathematical calculation, once the existence of non-economic loss is established, the jury is given significant discretion in fixing the amount of the award. Id. Yet, at the same time, a factual sufficiency review ensures that the evidence supports the jury’s award; and, although difficult, the law requires appellate courts to conduct a “meaningful” factual sufficiency review of a jury’s nonpecuniary damages award in a wrongful death case. Hawkins v. Walker, 238 S.W.3d 517 , 531 (Tex. App.—Beaumont 2007, no pet.) (citing Saenz, 925 S.W.2d at 614 )).12 Thus, while a jury has latitude in assessing intangible damages in wrongful death cases, its damage awards do not escape the scrutiny of appellate review. See Saenz, 925 S.W.2d at 614 . Merely establishing the existence of compensable mental anguish is not enough. Id. There must be evidence that the amount found is a fair and reasonable compensation, just as there must be evidence to support any other jury finding. Id. Juries are not permitted “to pick a number and 12 I note that while our sister court of appeals considered the Saenz dictate of a “meaningful review” to apply to the review of loss of companionship damages, the Texas Supreme Court has not yet expressly stated as much. Nevertheless, in Bennett v. Grant, the court signaled application of the meaningful review to non-economic damages generally. 525 S.W.3d 642 , 648 (Tex. 2017). For purposes of this dissent, given the nature of both mental anguish and loss of companionship damages, I find it appropriate to apply the same standard of review. –16– put it in the blank.” Id. 1. The Awards in This Case In this case, the jury awarded the Deol family non-economic damages totaling $15,065,000.13 This figure excludes the $500,000 the jury awarded Deol’s estate for his pain and mental anguish, the amount of which Gregory and New Prime do not complain. Broken down by damage category and family member, the jury awarded the following. Wife Each Son Daughter Mother Father Loss of past $350,000 $160,000 $160,000 $160,000 $160,000 companionship Loss of future $2,625,000 $1,200,000 $1,200,000 $160,000 $160,000 companionship Past mental $525,000 $160,000 $5,000 $160,000 $160,000 anguish Future mental $3,937,500 $925,000 $92,500 $160,000 $160,000 anguish Total $7,437,500 $2,445,000 $1,457,500 $640,000 $640,000 13 Damages for loss of companionship and society are intended to compensate the beneficiary for the positive benefits flowing from the love, comfort, companionship, and society that the beneficiary would have received had the decedent lived. Moore v. Lillebo, 722 S.W.2d 683 , 687–88 (Tex. 1986). Mental anguish is concerned not with the benefits the claimants have lost, but with the direct emotional suffering experienced as a result of the death. Id. at 688. In awarding damages for mental anguish and loss of society and companionship in a wrongful death case, the trier of fact may consider (1) the relationship between husband and wife, or a parent and child; (2) the living arrangements of the parties; (3) any absence of the deceased from the beneficiary for extended periods; (4) the harmony of family relations; and (5) common interests and activities. Id. –17– As noted supra, at trial, neither the Deol family nor the Vasquez/Perales family attempted to quantify the amount of non-economic damages. Instead, during closing arguments, Mr. Dollar, counsel for the Vasquez/Perales family, the family that settled their dispute with Gregory and New Prime during the pendency of this appeal, stated: “But if you don’t like any of the [earlier] analysis with respect to damages, then think about it this way . . . [J]ust give them your two cents worth . . . six cents a mile for the six hundred and fifty . . . million miles they traveled in the year that they took these people’s lives. . . . Just given them your two cents worth. That’s $39 million.” During his closing arguments, counsel for the Deol family stated, “I’m not going to recant what Mr. Dollar said, but all of it is all reflected by me as well.” The jury awards to the Vasquez/Perales and Deol family members totaled just over $38.8 million. Clearly, an award on the basis urged at trial would not be a fair and reasonable compensation, as it is not addressed to compensation at all. Instead, it would be punitive and could not survive a meaningful appellate review. The record before us, in and of itself, does not guide a fact-finder in calculating non-economic damages and does not provide a basis upon which this Court can conduct a meaningful review to determine the amounts awarded are fair and reasonable compensations to the Deol family members. As I noted above, supra at p. 9, respect for the jury’s decision supported as it is by legally sufficient evidence that the Deol family suffered non-economic injuries, that only the factual sufficiency –18– of the amount of those damages remain at issue, together with interests of judicial economy to avoid remand and new trial, compel me to suggest resort to an outside source for guidance to uphold the awards. The Deol family and Gregory and New Prime have provided us with samples of verdicts in other cases. Some of those cases involved the death of more than one family member,14 some involved a parent’s claim for the loss of a minor or teenage child,15 and in some the non-economic damages were not challenged.16 I believe the search for comparative awards should be limited to wrongful death cases involving a deceased married adult leaving behind minor children. Relatively few cases fall within this criteria, however. 2. The Evidence Presented in This Case The evidence established that Deol was 45 years old at the time of his death and his life expectancy was 78.4 years. So had Deol survived the accident, he was expected to live another 33 years. At trial, Deol’s wife, Jaswinder Chohan, was the 14 See Atchison, Topeka & Santa Fe Ry. Co. v. Cruz, 9 S.W.3d 173 , 182–86 (Tex. App.—El Paso 1999, pet. granted, judgm’t vacated, remanded by agr.) (death of both parents); Pittsburgh Corning Corp. v. Walters, 1 S.W.3d 759 , 781 (Tex. App.—Corpus Christi–Edinburg 1999, pet. denied) (death of spouse and adult son); C & H Nationwide, Inc. v. Thompson, 810 S.W.2d 259 , 265 (Tex. App.—Houston [1st Dist.] 1991) (death of spouse and father), rev’d on other grounds, 903 S.W.2d 315 (Tex. 1994). 15 See Welborn v. Sears, Roebuck & Co., 970 F.2d 1420 , 1427 (5th Cir. 1992) (death of teenage son); Russell v. Ramirez, 949 S.W.2d 480 , 486–87 (Tex. App.—Houston [1st Dist.] 1997, no pet.) (same); Guzman v. Guajardo, 761 S.W.2d 506 , 510–11 (Tex. App.—Corpus Christi–Edinburg 1988, writ denied) (death of minor son); Gulf States Util. Co. v. Reed, 659 S.W.2d 849 , 855 (Tex. App.—Houston [14th Dist.] 1983, writ ref’d n.r.e.) (death of teenage son). 16 See Serv-Air, Inc. v. Profitt, 18 S.W.3d 652 , 662 (Tex. App.—San Antonio 1999, pet. dism’d by agr.); C & H Nationwide, Inc. v. Thompson, 810 S.W.2d 259 , 265 (Tex. App.—Houston [1st Dist.] 1991), rev’d on other grounds, 903 S.W.2d 315 (Tex. 1994). –19– only witness who testified regarding the effect of Deol’s death on her and Deol’s family members and about the positive influences Deol had on them. 17 See Parkway, 901 S.W.2d at 444 (mental anguish evidence need not come from plaintiffs themselves, but may be provided in the form of third parties’ testimony). Through her testimony, Chohan established she met Deol when she was 17 or 18 years old and Deol was 26 or 27. They both lived in India at the time. Thereafter, Deol’s family moved to the United States, and Chohan’s family moved to Canada. Chohan and Deol maintained contact and eventually married in 2002. Three children were born to the marriage of Chohan and Deol, two sons, A.D. and H.D., and one daughter, G.D. The daughter is the youngest of the three. At the time of trial, A.D. and H.D. were 12 and 14 years old, respectively, and G.D. was 4 years old. Deol became a truck driver and eventually started his own company, Maryland Trucking. Deol was the primary financial provider for the family, and prior to his death, Chohan worked part-time at a toy store and helped Deol with his trucking business. Deol and Chohan were very close and talked constantly even when he was on the road. Chohan “told Deol everything” and, even though he is deceased, she “still talks to him when she is stressed.” Chohan described Deol as the love of her life. 17 Chohan testified the children were at home in Bakersfield, California, with their grandparents. She explained she did not bring the children to court because she did not want them to hear about the accident. She stated it was hard for her to be there. –20–  Deol loved to cook, work in the garden, and spend time with his family and delighted in seeing and hearing about his children’s accomplishments. Deol also liked to travel, and he often took the family on trips to different places. Deol wanted his children to be well educated and ensured that they took extra classes to get ahead. He did not want them to be truck drivers. On the night of the accident, Chohan tried calling Deol several times. She was concerned when Deol did not answer because he always answered her calls on the first ring. The next day, she continued to call him but got no answer. It was not until late afternoon that she learned, through Deol’s aunt, that Deol had been in an accident. She was not provided with any detail at that time. Frantic to find her husband, Chohan called around to hospitals in Texas to see if Deol had been admitted. She could not find him. Eventually, the police advised Chohan that Deol did not survive the accident. Chohan described that moment as the saddest in her life. When the children learned of Deol’s passing, H.D. sat with Chohan and held her. A.D. went to his room and would not talk to anyone. One of Chohan’s sisters took care of G.D., as she was only seven months old at the time. Deol’s sons were very attached to Deol, and he was a loving father. Deol’s father made arrangements to bring Deol’s body back to Gaithersburg, Maryland, where they were living, for a ceremony and cremation. The children attended the ceremony, during which the boys cried. –21–  Thereafter, Chohan, the children and Deol’s parents, who lived with Deol and his family, had to leave their home in Maryland because Chohan could not make the monthly mortgage payments. They moved to Bakersfield, California, to live with Deol’s brother, and Chohan began working for him as she now had to financially provide for the family. Chohan became depressed after Deol’s death and began taking prescription medication. At the time of trial, she was still on the medication and she still had all of Deol’s personal belongings, including his shoes and electric razor, containing fragments of his beard. Chohan explained she missed Deol every single moment. When the children do new things, it makes her sad that he is not there to share the moment. She has no one to talk to now. Going to things like parent-teacher conferences also makes her sad. While Chohan described her sadness and depressed state through the time of trial, she did not speak to the likely duration of her mental anguish or indicate she was in need of counseling presently or in the future. As to Deol’s eldest son, H.D., the jury did not hear any evidence of the likely duration of his mental anguish or the need for therapy or other treatment. Rather, Chohan relayed that H.D. used to be happy, now he is very quiet, and “stays to himself.” She recounted that H.D. was given two tickets to his middle school graduation. He brought one ticket home telling Chohan “we do not need two.” He then went to his room and cried. Deol and H.D. used to play video games, ride bikes, –22– and play basketball together. Deol used to put H.D. and A.D. to bed, and he would stay with them until they fell asleep. As to Deol’s son A.D., the jury likewise did not hear any evidence of the likely duration of A.D.’s mental anguish or the need for therapy or other treatment. Rather, Chohan described A.D. as being similar to Deol. She stated that, since Deol’s death, A.D. has gained a lot of weight because he is less active than he used to be. Before Deol’s death, Deol and A.D. often did things together, now A.D. just sits with Chohan and reads. Chohan claimed A.D. seems depressed most days and indicated he often talks about his father and thinks about what they would have done had Deol still been alive. A.D. was in a gifted program in his school in Maryland. After the move to California, that was no longer an option, as Chohan could not afford to pay for extra classes. H.D. and A.D. commented about what they remember about their dad and what they miss. They remember playing with him and going to different places. Now there is no adult male to play with them, and they do not travel because Chohan does not like to drive on the highway and they do not have the financial resources to pay for travel. Both boys continue to cry out for their father. G.D. was only seven months old when Deol died. At the time of trial, she was four years old. The jury did not hear any evidence of G.D.’s mental anguish. Rather, Chohan explained that G.D. asks a lot of questions about her dad. Every day she asks when he is going to come home, and she now tells people she does not have a –23– dad. She is trying to “figure out why she is different” from other children and does not have a dad. At the time of trial, Deol’s mother and father were 75 and 80 years old, respectively. They learned of Deol’s death when police officers arrived at their home in Gaithersburg, Maryland. Deol and his mother were very close. They used to cook and garden together. Since Deol’s death, Deol’s mother is always crying, and she has aged significantly. While Deol’s father does not cry in front of Chohan, she explained that since Deol’s death, the entire family’s living environment is sad. Everything has changed. The jury did not hear any evidence concerning the likely duration of the mental anguish or the need for therapy or other treatment of any of the family members. a. Non-economic Damages Awarded to Surviving Spouses In Badall v. Durapersad, the court of appeals affirmed awards of $105,000 for loss of companionship and $41,240 for mental anguish to the wife of a 56 year old man shot and killed in a tire shop he owned. 454 S.W.3d 626 , 639–40 (Tex. App.—Houston [1st Dist.] 2014, pet. denied). In that case, Durapersad testified that her husband’s death left her without her soul mate, her everything. She missed him every day. Id. at 632. She acknowledged she and her husband had some arguments and disagreements. Id. She claimed to have suffered a heart attack as a result of her husband’s death, to no longer sleep well, and to have been in and out of doctors’ offices and the hospital since her husband’s death. Id. Durapersad indicated that for –24– most of the six years preceding her husband’s death, she worked in Louisiana and came to Texas on the weekends to be with her husband. Id. She had retired a few months before her husband’s death to spend more time with him. Id. In Thomas v. Uzoka, the court of appeals affirmed awards of $100,000 for past mental anguish, $50,000 for future mental anguish, $100,000 for past loss of companionship and $450,000 for future loss of companionship to the wife of a taxi- cab driver who had been killed in a head-on collision. 290 S.W.3d 437 , 456 (Tex. App.—Houston [1st Dist.] 2009, pet. denied). The evidence established that during the first few years of their marriage, Uzoka and her husband lived in different cities because they were enrolled in different universities. Id. They saw each other on the weekends. Id. At trial, Uzoka testified she and her husband planned to get a nice apartment together when they graduated from college and to have a formal wedding, as they had married at the courthouse without a significant ceremony. Id. They also planned to have at least two, and possibly as many as four, children. Id. In Phillips v. Bramlett, the court of appeals concluded that awards of $1,000,000 to Bramlett for mental anguish and $1,265,000 for loss of companionship in connection with the death of his wife following a mis-performed hysterectomy were supported by factually sufficient evidence. 258 S.W.3d 158 , 174–176 (Tex. App.—Amarillo 2007, no pet.), rev’d on other grounds, 288 S.W.3d –25– 876 (Tex. 2009).18 The evidence presented in that case established Bramlett and his wife enjoyed a harmonious relationship in which each was a full partner in the marriage. Their work schedules left little time for outside interests, and Bramlett and his wife spent their time raising a family and furthering their collective goals. Id. at 174. Bramlett testified that since his wife’s death, his life had become empty. Id. In addition, there was evidence of the nature, duration, and severity of Bramlett’s mental anguish. Although it had been three years since Bramlett’s wife’s death, he still felt the same, and he thinks he hears his wife in the house. Id. In Columbia Medical Center of Las Colinas v. Hogue, this Court affirmed awards of $750,000 for past loss of consortium, $1,250,000 for past mental anguish, $1,750,000 for future loss of consortium, and $600,000 for future mental anguish to the wife of a man who died while seeking medical assistance for pulmonary and cardiac issues. 132 S.W.3d 671 , 684 (Tex. App.—Dallas 2004), aff’d in part, rev’d in part on other grounds, 271 S.W.3d 238 (Tex. 2008). In affirming these awards, this Court considered testimony that the decedent and his wife were married for 26 years, and when he died, “half of [her] died”; decedent spent considerable time with his wife and two sons visiting his sons often at college and talking with one of his sons over the phone several times a week; his sons were everything to him, they had 18 The Texas Supreme Court concluded the damage caps in the Medical Liability Act and Insurance Improvement Act applied. –26– a great bond and were best friends; decedent coached his sons in sports; overall, the relationship of decedent with his family was strong and good. Id. at 684, 686. The substantial range of non-economic awards to surviving spouses from a total of $146,240 in Badall v. Durapersad to $4,350,000 in Columbia Medical Center of Las Colinas v. Hogue to $7,437,500 in this case highlights the problem with the current adherence to the proof standards dictated by Saenz at the trial court level and the apparent lack of objectively predictable appellate review guidelines. Nevertheless, these cases would appear to demonstrate that the jury’s awards of non- economic damages to Chohan in this case are excessive. b. Non-economic Damages Awarded to Children of the Deceased In Wackenhut Corrections Corp. v. de la Rosa, the court of appeals affirmed awards of $2,000,000 for future mental anguish and $2,000,000 for future loss of consortium to the daughters of de la Rosa who was brutally murdered by two inmates while incarcerated at a Wackenhut Corrections’ facility. 305 S.W.3d 594 , 608, 636– 40 (Tex. App.—Corpus Christi–Edinburg 2009, no pet.). De la Rosa was an honorably discharged former National Guardsman, who was serving a six-month sentence in connection with the possession of less than 1/4 gram of cocaine. Id. at 600. A few days before his expected release, De la Rosa was beaten to death by two other inmates using a lock tied to a sock, while Wackenhut’s officers stood by and watched, and Wackenhut’s wardens smirked and laughed. Id. In that case, several witnesses testified as to the effect of De la Rosa’s death on his three daughters, –27– including the daughters themselves. De la Rosa’s widow testified De la Rosa was very excited to have children and about his loving and nurturing relationships with his daughters. Id. at 638. She testified about their reactions to De la Rosa’s death and indicated that they cry and are very sad. Id. De la Rosa’s sister also testified about the effect of De la Rosa’s death on his daughters. The oldest daughter tattooed her father’s name on herself because she did not want to let him go. Id. The oldest daughter was eighteen years old at the time of trial. She testified about how much she loved her father and how sad she was that he was not at her graduation and that she would miss him at important times in her life such as when she gets married and has a child. Id. at 639. De la Rosa’s other daughters testified about how much they loved and missed their father. While De la Rosa and his wife had been separated for some time, his wife testified she was sure De la Rosa would be involved in their lives upon release from prison and she and De la Rosa intended to discuss reconciliation upon his release. Id. In Phillips v. Bramlett, the Amarillo court of appeals concluded that awards of $1,000,000 to each of Vicki Bramlett’s sons for mental anguish and $2,250,000 for loss of companionship were supported by factually sufficient evidence. 258 S.W.3d at 175 –176. The evidence presented in that case established that as a result of Vicki’s death, her sons moved to Oregon to be near Vicki’s twin sister. Id. at 176. Although the move had helped, things were not the same. Id. The sons testified that they think about their mother almost every day. Id. The court noted that the –28– evidence “was demonstrative of the significant role that Vicki played in the lives of the boys.” Id. at 174. She was their personal mentor in all things. Id. The court further noted that the relationship Vicki’s sons had with Vicki was strong, they lived with Vicki at the time of her death, there were no extended absences by anyone from the home, and they shared interests, most significantly, the lives of each other. Id. at 175. In Fibreboard Corp. v. Pool, the court of appeals affirmed a total award of $25,000 for loss of companionship to the seven minor children of a man who died from asbestos exposure.19 813 S.W.2d 658 , 684 (Tex. App.—Texarkana 1991, writ denied). One of the deceased’s sons testified his father “pushed the children hard” because he wanted them to excel, that he was a good role model, that he was supportive of the children, and that he was always available to help them with their problems. Id. The deceased’s wife testified that her children’s father was a good family man and was good with the children. Id. The court of appeals concluded, “[e]vidence of a father who is a good role model and who is always around to help his children, with no evidence to the contrary, is sufficient to support the award of damages.” Id. The range in these damages from $6,700 to $4,000,000 once again appears to demonstrate the lack of consistent or predictable standards of review in this area. 19 Adjusting for inflation, the award would be $47,000, so approximately $6,700 per child. –29– The breadth of the range on highly similar fact patterns presents a challenge in identifying anything beyond the range itself. There is obviously a potential for inadequate damages at the low end and excessiveness at the other. Operating on the assumption that each, and thus all, of these appellate courts adhered to the dictate of “meaningful” review, we would be left to choose between the minimum and maximum approved awards or an average, assuming these cases are sufficient in number to permit the comparison to support the judgment. c. Non-economic Damages Awarded to Parents of the Deceased In Wackenhut Corrections Corp. v. De la Rosa, the Corpus Christi Court of Appeals affirmed awards of $2,500,000 for past mental anguish, $2,500,000 for future mental anguish, $2,500,000 for past loss of consortium, and $2,500,000 for future loss of consortium to De la Rosa’s mother. 305 S.W.3d at 642 . The evidence at trial established De la Rosa’s mother was very close to her son and enjoyed a strong relationship with him—so much so that he named his first-born child after her. Id. at 640. The family spent weekends together and family holidays, and De la Rosa’s mother was particularly proud of her son, a former National Guardsman. Id. She suffered severe emotional distress due to the brutal murder of her child in the custody of, and at the hands of, those who were charged with his protection. Id. The testimony showed that the wardens smirked and laughed while De la Rosa was beaten to death and De la Rosa was beaten so badly that his mother did not recognize him when he was being identified at the funeral home. Id. at 641. The testimony –30– further showed that De la Rosa’s mother clung to her son’s picture and cried every night, wishing that her own death would come sooner so that she could join her son. Id. In Page v. Fulton, the Beaumont Court of Appeals affirmed an award of $150,000 for pecuniary loss, loss of companionship and mental anguish to the parents of the deceased who was murdered by her husband. 20 30 S.W.3d 61 , 72–73 (Tex. App.—Beaumont 2000, no pet.). The court noted there was little evidence in the record as to the effect of the daughter’s death on her father other than his dogged determination to pursue his former son-in-law. Id. at 72. Because a single question was submitted to the jury for both parents, the court noted that the award could be upheld if there was evidence supporting the award for either parent. Id. at 72–73. The evidence established the family was close and enjoyed frequent contact and that eight years after her death, her mother could barely think about it. Id. at 73. Not only was their daughter murdered, her parents had to slowly come to the realization that a loved and trusted member of the family was responsible for her death. Id. In Pittsburgh Corning Corp v. Walters, the Corpus Christi Court of Appeals affirmed awards of $145,375.54 to each of the parents of the deceased who died from mesothelioma.21 1 S.W.3d 759 , 781 (Tex. App.—Corpus Christi–Edinburg 1999, pet. denied). The evidence established the deceased was the only son of the 20 Adjusting for inflation, the award would be approximately $225,000. 21 Adjusting for inflation, the awards would be approximately $225,000 to each parent. –31– Walters and they relied on him to provide substantial support due to their age and health. Id. His death left his parents with no other family. Id. Again, the vast range of awards from $225,000 (after adjusting for inflation) to $10,000,000 seems to demonstrate the chronic nature of the review problem that Saenz and its progeny set out to resolve. The evidence concerning the effect of Deol’s death upon his parents is most akin to that presented in Walters; thus I conclude the awards of $640,000 to Deol’s parents are potentially excessive, though to what extent is difficult to discern from the relatively few cases available and their wide range. D. Remittitur or Remand Because I am issuing a dissenting opinion, I ultimately need not determine whether there are enough awards in cases with similar data points to suggest remittiturs here or whether a remand for a retrial would be the appropriate remedy. In all events, I find the record bereft of any evidentiary basis for the jury’s decision to award approximately $15 million in damages to the Deol family and cannot join the majority in affirming the judgment without either reformation by some meaningful attempt at remittitur or a remand for a new trial. 180167CF.P05 /David J. Schenck/ DAVID J. SCHENCK JUSTICE Browning, and Richter, J.J., join in this concurring and dissenting opinion. –32–

2020-03-06 01:14:45.353803+00

http://www.search.txcourts.gov/RetrieveDocument.aspx?DocId=83622&Index=%5c%5coca%2dpsql12%2ecourts%2estate%2etx%2eus%5cTamesIndexes%5ccoa12%5cOpinion

NO. 12-19-00153-CR IN THE COURT OF APPEALS TWELFTH COURT OF APPEALS DISTRICT TYLER, TEXAS KARL LYNN SHACKELFORD, § APPEAL FROM THE APPELLANT V. § COUNTY COURT AT LAW NO. 3 THE STATE OF TEXAS, APPELLEE § SMITH COUNTY, TEXAS MEMORANDUM OPINION PER CURIAM Karl Lynn Shackelford appeals from his conviction for criminal trespass. Appellant’s counsel filed a brief in compliance with Anders v. California, 386 U.S. 738 , 87 S. Ct. 1396 , 18 L. Ed. 2d 493 (1967) and Gainous v. State, 436 S.W.2d 137 (Tex. Crim. App. 1969). We affirm. BACKGROUND Appellant was charged by information with criminal trespass. Appellant, appearing pro se, pleaded “not guilty” and the matter proceeded to a jury trial. During trial, the jury heard evidence that Appellant was told to leave the Tyler Police Department on August 21, 2018, after yelling and cursing at employees working the front window. Sergeant Wendell Gardner testified that he told Appellant that he would be arrested for criminal trespass if he returned. Sergeant Gardner further testified that he was dispatched to a disturbance call in the lobby of the Tyler Police Department on September 11, 2018, and Appellant was in the lobby when the sergeant arrived. Sergeant Gardner testified that Appellant would not have been criminally trespassing if he had been at the Tyler Police Department regarding an emergency. However, that was not the case. Following evidence and argument, the jury found Appellant “guilty” of criminal trespass. After the sentencing portion of the trial, the trial court sentenced Appellant to 180 days confinement. This appeal followed.  ANALYSIS PURSUANT TO ANDERS V. CALIFORNIA Appellant’s counsel filed a brief in compliance with Anders v. California and Gainous v. State. Appellant’s counsel states that he diligently reviewed the appellate record and is of the opinion that the record reflects no reversible error and that there is no error upon which an appeal can be predicated. He further relates that he is well acquainted with the facts in this case. In compliance with Anders, Gainous, and High v. State, 573 S.W.2d 807 (Tex. Crim. App. [Panel Op.] 1978), Appellant’s brief presents a chronological summation of the procedural history of the case and further states that Appellant’s counsel is unable to raise any arguable issues for appeal. 1 We have likewise reviewed the record for reversible error and have found none. CONCLUSION As required by Stafford v. State, 813 S.W.2d 503 (Tex. Crim. App. 1991), Appellant’s counsel moved for leave to withdraw. See also In re Schulman, 252 S.W.3d 403 , 407 (Tex. Crim. App. 2008) (orig. proceeding). We carried the motion for consideration with the merits. Having done so and finding no reversible error, Appellant’s counsel’s motion for leave to withdraw is hereby granted and the appeal is affirmed. As a result of our disposition of this case, Appellant’s counsel has a duty to, within five days of the date of this opinion, send a copy of the opinion and judgment to Appellant and advise him of his right to file a petition for discretionary review. See TEX. R. APP. P. 48.4; In re Schulman, 252 S.W.3d at 411 n.35. Should Appellant wish to seek review of this case by the Texas Court of Criminal Appeals, he must either retain an attorney to file a petition for discretionary review on his behalf or he must file a petition for discretionary review pro se. Any petition for discretionary review must be filed within thirty days from the date of either this opinion or the date that the last timely motion for rehearing is overruled by this Court. See TEX. R. APP. P. 68.2. Any petition for discretionary review must be filed with the Texas Court of Criminal Appeals. See TEX. R. APP. P. 68.3(a). Any petition for discretionary review should comply with 1 In compliance with Kelly v. State, Appellant’s counsel provided Appellant with a copy of the brief, notified Appellant of his motion to withdraw as counsel, informed Appellant of his right to file a pro se response, and took concrete measures to facilitate Appellant’s review of the appellate record. See Kelly v. State, 436 S.W.3d 313 , 319 (Tex. Crim. App. 2014). Appellant was given time to file his own brief. The time for filing such a brief has expired, and no pro se brief has been filed. 2 the requirements of Texas Rule of Appellate Procedure 68.4. See In re Schulman, 252 S.W.3d at 408 n.22. Opinion delivered March 4, 2020. Panel consisted of Worthen, C.J., Hoyle, J., and Neeley, J. (DO NOT PUBLISH) 3  COURT OF APPEALS TWELFTH COURT OF APPEALS DISTRICT OF TEXAS JUDGMENT MARCH 4, 2020 NO. 12-19-00153-CR KARL LYNN SHACKELFORD, Appellant V. THE STATE OF TEXAS, Appellee Appeal from the County Court at Law No. 3 of Smith County, Texas (Tr.Ct.No. 003-83674-18) THIS CAUSE came to be heard on the appellate record and brief 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. By per curiam opinion. Panel consisted of Worthen, C.J., Hoyle, J. and Neeley, J.

2020-01-17 22:01:47.093125+00

Smith

*949OPINION. Smith: Although the petitioner kept its books of account and made its income-tax returns for 1919 and 1920 upon the accrual basis, it contends that it is entitled to deduct from the gross income of 1920, the full amount of the interest paid in that year by giving to the creditors entitled to receive interest new notes in the principal amount of the principal plus interest accrued to date. In the alternative, it contends that in any event it is entitled to deduct from the gross income of 1919, the full amount of the interest accrued on two notes given on April 1, 1914, in the respective amounts of $92,696 and $81,923, the notes specifically providing that the interest thereon was not to become due and payable until April 1,1919; that if this deduction is permitted for the year 1919, it simply serves to increase the net loss for that year which may be deducted from the gross income of 1920 under the provisions of section 204 of the Revenue Act of 1918, the petitioner having had no net income for the calendar year 1918. Interest is an expense which accrues ratably over an elapsed period of time. Cumberland Glass Mfg. Co., 2 B. T. A. 1122; Saner-Ragley Lumber Co., 3 B. T. A. 927. A taxpayer on the accrual basis may not deduct from the gross income of any one year interest paid in that year which accrued and became a liability but which was not accrued on its books in a preceding year. McIntosh & Seymour Corporation, 2 B. T. A. 953, Interest is deductible as it accrues and not when paid *950by a taxpayer on tbe accrual basis. North Wayne Tool Co., 2 B. T. A. 366; Comstock-Castle Stove Co., 4 B. T. A. 114; Higginbotham-Bailey-Logan Co., 8 B. T. A. 566. Tbe petitioner, relying upon tbe decision of the Board in Concord Electric Co., 7 B. T. A. 1027, claims the right to deduct from tbe gross income of 1920 the interest paid in that year by new notes taking up the old notes with principal and interest. In the last cited case the Board held that where interest is payable upon a certain date contingent upon a contract not being terminated before that date the interest payable under the contract became a liability when the obligation to pay the interest is fixed. The facts in the instant proceeding are substantially different. There is on the part of the petitioner no contingency with respect to the payment of interest upon the two notes given on April 1,1914. The amount of the interest payable was at an annual rate and a given amount accrued each year. This amount was determinable upon the facts known at the end of each year. In United States v. Anderson, 269 U. S. 422, the court stated in part: While See. 12 (a) taken by itself would appear to require the income tax return to be made on the basis of actual receipts and disbursements, it is to be read with Sec. 13 (d) * * * providing in substance that a corporation keeping its books on a basis other than receipts and disbursements, may make its return on that basis provided it is one which reflects income * * ⅜ Treasury Decision 2433 ⅜ * * recognized the right of the corporation to deduct all accruals ⅜ * * made on its books to meet liabilities, provided the return included income accrued and, as made, reflected true net income * * *. A consideration of the difficulties involved in the preparation of an income account on a strict basis of receipts and disbursements * * * indicates with no uncertainty the purpose of Secs. 12 (a) and 13 (d) * * * to enable taxpayers to keep their books and make their returns according to scientific accounting principles, by charging against income earned during the taxable period, the expenses incurred and properly attributable to the process of earning income during that period; and indeed, to require the tax return to be made on that basis, if the taxpayer failed or was unable to make the return on a strict receipts and disbursements basis * * * The (corporation’s) true income could not have been determined without deducting from its gross income during the year the total costs and expenses attributable to the production of that income during the year * ⅜ *. In the economic and bookkeeping sense with which the statute and Treasury decision were concerned, the (munitions) taxes have accrued. It should be noted that Sec. 13 (d) makes no use of the words “ accrue ” or “ accrual ” but merely provides for a return upon the basis upon which the taxpayer’s accounts are kept, if it reflects income * * ⅜ We do not think that the Treasury decision contemplated a return on any other basis when it used the terms “ accrued ” and “ accrual ” and provided for the deduction by the taxpayer of items “ accrued on their books.” Cf. American National Co. v. United States, 274 U. S. 99. In tbe instant proceeding tbe accrual basis furnishes an accurate picture of tbe income of tbe taxpayer for tbe year 1920. There is no *951evidence that interest upon indebtedness accrued in a greater amount than $48,862.54, the amount allowed as a' deduction by the respondent. Reviewed by the Board. Judgment will be entered for the respondent.

2021-01-26 21:00:46.535529+00

https://cdn.ca9.uscourts.gov/datastore/memoranda/2021/01/26/19-16615.pdf

NOT FOR PUBLICATION FILED UNITED STATES COURT OF APPEALS JAN 26 2021 MOLLY C. DWYER, CLERK U.S. COURT OF APPEALS FOR THE NINTH CIRCUIT PATSY N. SAKUMA, No. 19-16615 Plaintiff-Appellant, D.C. No. 1:16-cv-00274-DKW- KJM v. ASSOCIATION OF APARTMENT MEMORANDUM* OWNERS OF THE TROPICS AT WAIKELE, an incorporated association, by its board of directors; et al., Defendants-Appellees, and LOVE, YAMAMOTO & REVERE, LLP, a limited liability law partnership; YAMAMOTO & REVERE, LLP, a liability law partnership, Defendants. Appeal from the United States District Court for the District of Hawaii Derrick Kahala Watson, District Judge, Presiding Submitted January 20, 2021** * This disposition is not appropriate for publication and is not precedent except as provided by Ninth Circuit Rule 36-3. ** The panel unanimously concludes this case is suitable for decision without oral argument. See Fed. R. App. P. 34(a)(2). Before: McKEOWN, CALLAHAN, and BRESS, Circuit Judges. Patsy N. Sakuma appeals pro se from the district court’s post-judgment orders in her action alleging Racketeer Influenced and Corrupt Organizations Act (“RICO”) and state law claims. We have jurisdiction under 28 U.S.C. § 1291 . We review for an abuse of discretion. Sch. Dist. No. 1J, Multnomah Cty., Or. v. ACandS, Inc., 5 F.3d 1255 , 1262-63 (9th Cir. 1993). We affirm. The district court did not abuse its discretion by denying Sakuma’s Federal Rule of Civil Procedure 60(b)(6) motion for relief from judgment, or by denying leave to file a motion for reconsideration, because Sakuma failed to demonstrate any basis for the requested relief. See id. (setting forth grounds for relief under Rule 59(e) or 60(b)); see also Latshaw v. Trainer Wortham & Co., 452 F.3d 1097 , 1102-04 (9th Cir. 2006) (explaining that Rule 60(b)(6) relief may be granted only where extraordinary circumstances are present). We do not consider Sakuma’s contentions concerning her prior appeal (Case No. 16-16791). Sakuma’s request for judicial notice, set forth in her opening brief, is denied as unnecessary. AFFIRMED. 2 19-16615

2020-11-21 03:15:48.227309+00

Charles W. Bate v. Commissioner. Bate v. Commissioner Docket No. 2065-66. United States Tax Court T.C. Memo 1967-165; 1967 Tax Ct. Memo LEXIS 95; 26 T.C.M. (CCH) 780; T.C.M. (RIA) 67165; August 9, 1967 Charles W. Bate, pro se, 1226 42nd Ave., San Francisco, Calif. Robert M. Zimmerman, for the respondent. FAY Memorandum Findings of Fact and Opinion FAY, Judge: Respondent determined a deficiency of $162.55 in petitioner's income tax for the taxable*96 year 1963. There are two issues for decision: (1) Is petitioner entitled to use the "head of household" tax rates in section 1(b)(1) of the Internal Revenue Code of 19541 and (2) is petitioner entitled to a dependency deduction under section 151(e)(1) for his daughter, Deborah. Findings of Fact Some of the facts have been stipulated, and the stipulation of facts, together with the exhibits attached thereto, is incorporated herein by this reference. Charles W. Bate (hereinafter referred to as petitioner) filed a Federal individual income tax return for the taxable year 1963 on the cash basis with the district director of internal revenue at San Francisco, California. Petitioner was a legal resident of San Francisco, California, when he filed the petition in this case. Petitioner and Mary Jane Bate (hereinafter referred to as Mary) were married in 1946. Deborah Mia Bate (hereinafter referred to as Deborah) was born on September 24, 1949. She is the legally adopted daughter of petitioner and Mary. Deborah was not married during 1963. On January 24, 1955, the*97 Superior Court of the State of California in and for the County of San Francisco, California, granted a final decree of divorce to Mary. The decree gave "actual physical" custody of Deborah to Mary, subject to a right of petitioner to "see and visit with" Deborah and to have her with him on weekends. The decree also ordered petitioner to pay Mary $50 a month for Deborah's support until Deborah's twenty-first birthday. In the years following the divorce, petitioner, Mary, and Deborah developed a pattern whereby Deborah stayed with Mary during the school week and with petitioner on weekends and school vacations. During 1963, Mary and R. V. Cottam (hereinafter referred to as Cottam) jointly occupied a house owned by Cottam in Los Gatos, California. There was a room in the house set aside for Deborah's private use. During 1963, petitioner rented and occupied a two-bedroom apartment in San Francisco, California. Petitioner set aside one of the bedrooms for Deborah's private use. In 1963, petitioner paid more than one-half of the total costs of maintaining the apartment including, among other items, rent, utilities, and groceries consumed on the premises. In the calendar year 1963, *98 Deborah spent at least 113 days at petitioner's apartment. She spent at least 207 days in Cottam's house. She spent 34 days on a summer trip to the East. 2 During 1963, Deborah kept about threequarters of her clothing at Cottam's house. She kept the remainder of her clothes at petitioner's apartment. In 1963, Deborah earned $68 doing small jobs for petitioner and Mary. Deborah deposited $24 of this in a bank account and spent the rest in the same manner as her allowance. Pursuant to the above-mentioned divorce decree, petitioner paid $600 to Mary in 1963 for the use and maintenance of Deborah. Petitioner gave Deborah $96 during the year to cover part of her bus fares in traveling between Los Gatos and San Francisco. Petitioner in 1963 spent $150 for such items as Deborah's clothing, entertainment, and education. When Deborah traveled to the East, petitioner spent $128.08 to defray part of the cost of her trip. In 1963, petitioner paid a premium of $174.12 on an ordinary (nonterm) life insurance policy. Petitioner is the owner and insured of the policy. Deborah was the beneficiary of*99 the policy in 1963. Petitioner had the right to change the beneficiary. During 1963, petitioner spent $2 and $2.25 for, respectively, a copy of a birth certificate and a copy of Deborah's adoption proceedings. Petitioner used these documents to claim Social Security benefits. In 1963, petitioner paid rent for his apartment of $1,038. He paid $1,539 for general household expenses such as utilities and groceries. Deborah consumed part of the groceries when she stayed at petitioner's apartment. She usually ate breakfast, lunch, and dinner at his apartment on both Saturday and Sunday. Mary spent $1,141.21 during 1963 for the use and maintenance of Deborah. This was for items such as dentist's visits, furnishings for Deborah's room in the Cottam house, bus fares, wardrobe, food, school expenses, and utilities. Of this figure, $541.21 represented Mary's money and $600 represented money received from petitioner, referred to above. Mary purchased a piano in 1963. Her payments in that year for the piano totalled $172.65. Both Mary and Deborah used the piano. Mary did not pay rent to Cottam. She paid for the food consumed by Cottam, Deborah, and herself. She also paid the utility and*100 telephone bills of the Cottam house. In return, Deborah and Mary received rent-free lodgings. The fair rental value of Deborah's private room in the Cottam house was $18 per week. Cottam's costs in maintaining the house during 1963 totalled $2,760. When Deborah went East in the summer of 1963, she visited and traveled with Ruth Deck (hereinafter referred to as Ruth). Ruth gave $300 to cover part of the cost of Deborah's travel to and from the East. In addition, Ruth bought the food which Deborah consumed while staying at Ruth's house in Maine for two weeks. 3 Ruth also paid the travel and lodging expenses of Deborah when she and Deborah drove twice to New York City and once to Florida. Ruth paid for some of Deborah's meals and entertainment on these trips. In his Federal income tax return for 1963, petitioner took a dependency deduction for Deborah under section 151(e). He computed his tax liability with the head of household rates in section 1(b)(1). In his notice of deficiency for 1963, respondent*101 denied the dependency deduction on the ground that petitioner did not provide over one-half of Deborah's support. 4 He recomputed petitioner's tax liability with the single taxpayer rates of section 1(a) on the ground that petitioner was not entitled to use the special rates of section 1(b)(1). As to the latter point, the notice of deficiency contained the following: The Head of Household rate is denied because you did not maintain a home for an individual described in Section 1(b)(2), Internal Revenue Code. Opinion There are two issues for decision. The first is whether petitioner is entitled to use the "head of household" tax rates in section 1(b)(1) to compute his tax liability for 1963. Before reaching this issue, there is a procedural question. Petitioner contends that the statutory notice of deficiency was so poorly worded that it did not raise the tax-rate issue and that, therefore, it did not place the burden of proof on him. Petitioner's argument centers around the Commissioner's use of the word*102 "home," rather than "abode," in the deficiency notice. We hold that the notice of deficiency clearly apprised petitioner of the head of household issue and that the burden of proof is on him. Manuel D. Mayerson, 47 T.C. 340">47 T.C. 340 (1966). Turning to the substantive issue, the question is whether petitioner was a "head of household" in 1963 as defined in section 1(b)(2). The only dispute is whether petitioner's apartment was Deborah's "principal place of abode." The Commissioner's Regulations provide that in order for a taxpayer's home to be the principal place of abode of another person the person must occupy the home for "the entire taxable year of the taxpayer." Regs. section 1.1-2(c)(1). This is a reasonable interpretation of the statute, in view of the Committee Reports which accompanied its original enactment. H. Rept. No. 586, to accompany H.R. 4473 (Pub. L. 183), 82d Cong., 1st Sess., p. 106 (1951); S. Rept. No. 781, to accompany H.R. 4473 (Pub. L. 183), 82d Cong., 1st Sess., p. 11 (1951). 5 The Regulations modify the requirement, however, to take account of temporary absences: The taxpayer and such other person will be considered as occupying the household for*103 such entire taxable year notwithstanding temporary absences from the household due to special circumstances. A non-permanent failure to occupy the common abode by reason of illness, education, business, vacation, military service, or a custody agreement under which a child or stepchild is absent for less than six months in the taxable year of the taxpayer, shall be considered temporary absence due to special circumstances. * * * [Regs. section 1.1-2(c)(1)] Although Deborah did not occupy petitioner's apartment during the entire year in question, petitioner contends that his home was her "principal place of abode" as interpreted by the Regulations because her absences come under the temporary absence rule. He argues that Deborah's summer trip comes under the vacation portion of the rule and the time she spent with Mary*104 comes under the education portion of the rule. We cannot agree. It is more reasonable to characterize Deborah's time at Mary's home as an absence due to a custody agreement than as an absence due to education. It is true that Deborah attended school while living with Mary. But that is only because the divorce decree gave custody to Mary during the school week. Since Deborah lived with Mary for at least 207 days during 1963, Deborah's absence from petitioner's apartment by reason of the custody arrangement was for a period greater than six months. This time away from petitioner's home, therefore, does not come under the custody portion of the temporary-absence rule. It follows that petitioner's apartment was not Deborah's "principal place of abode" as interpreted by the Regulations. Petitioner argues in the alternative that Deborah's intention should control whether his apartment was her principal place of abode. He admits that Deborah had at least two abodes in 1963 but argues that she viewed his as the principal one. We do not consider it necessary to deal with this argument. The record fails to disclose which of Deborah's two abodes, if either, she considered to be the principal*105 one. Since petitioner failed to prove Deborah's intent in this regard, it is not necessary to consider the possible effect of such intent on the issue at hand. 6 We therefore conclude that petitioner's home was not Deborah's "principal place of abode" during 1963. It follows that petitioner is not within the definition of "head of household" for that year. Petitioner may not use the head of household tax rates to compute his tax liability for 1963. The second issue for decision is whether petitioner is entitled to a dependency exemption for Deborah in 1963 under section 151(e). The only dispute is whether petitioner provided over one-half of Deborah's "support" in 1963. The record indicates that there were five sources of Deborah's support in 1963. One was Deborah. During the year she earned $68. She put $24 of this in a bank account and spent the rest. The amount she spent -$44 - was a contribution to her own support. See Regs. section 1.152-1(a)(2)(ii). Another source of support for Deborah was Mary. Mary paid*106 $172.65 toward the purchase of a piano in 1963. Petitioner contends this cannot be included in the total of Deborah's support because the piano was Mary's property, not Deborah's. We do not agree. Use, not title, governs whether an item contributes to a person's support. Since both Mary and Deborah used the piano, however, only half the expense, or $86.32, should be included in Deborah's support. Mary also contributed to Deborah's support by paying for items such as dental care, bus fares, food, utilities, and furnishings for Deborah's room in the Cottam house. Mary testified that the total of those expenses was $541.21. Although petitioner does not question the inclusion of these items of support, he suggests that the amount is excessive due to Mary's not being a disinterested witness. We do not agree that the amount is excessive. We hold that Mary contributed $541.21 to Deborah's support in addition to the piano payments. A third source of Deborah's support in 1963 was Cottam, because of the room which she used in his house. Petitioner argues that the amount considered support because of this occupancy should be one-third of Cottam's cost of maintaining the house during the year, *107 not the fair rental value of Deborah's room. We cannot accept this argument. The firmly established rule is that fair rental value, not cost, is the measure of support furnished as lodging. Emil Blarek, 23 T.C. 1037">23 T.C. 1037 (1955), William M. Haynes, 23 T.C. 1046">23 T.C. 1046 (1955). See also, Regs. section 1.152-1(a)(2)(i). Petitioner claims that the fair rental value of Deborah's room in Cottam's house was computed on the basis of a furnished room, including utilities. He therefore argues that the fair rental value should be reduced by amounts which Mary spent for utilities and furnishings attributable to Deborah's room in 1963. We see nothing in the record which indicates whether the fair rental value of Deborah's room was computed on the basis of a furnished room, including utilities, or on the basis of an unfurnished room, not including utilities. Since petitioner did not produce evidence to support his argument, we hold against him on it. A fourth source of Deborah's support in 1963 was Ruth. Ruth gave $300 to cover Deborah's expenses traveling to and from the East. Petitioner argues that this contribution should not be considered "support." He contends that "support" *108 is limited to ordinary and necessary expenses and that Deborah's summer trip was neither ordinary nor necessary. We do not decide whether petitioner's statement of the law is correct because we do not think Deborah's trip was extraordinary or unnecessary. We therefore hold that Ruth's gift of $300 was a contribution toward Deborah's support. Ruth also made many expenditures during Deborah's month-long stay in the East for Deborah's food, lodging, travel, and entertainment. Nothing in the record indicates the amount of these expenses. It is not, however, necessary to pursue this matter. It will be seen that even without considering Ruth's expenses, other than her initial $300 gift, petitioner has not proved that he contributed over half of Deborah's support in 1963. It is now possible to establish the minimum amount of Deborah's support in 1963 which persons other than petitioner supplied. The total is at least $1,907.53, comprised of the following: Contribution byAmount Deborah$ 44.00 Mary627.53 Cottam936.00 Ruth300.00 Total$1,907.53 The final source of Deborah's support during 1963 was petitioner. He claims that he contributed the following*109 items and amounts: Monthly payments under divorce decree$ 600.00 Bus fares96.00 Miscellaneous150.00 Travel (trip to East)128.08 Life insurance premium174.12 Documents4.25 Portion of apartment rent552.00 Portion of general household expenses313.62 Total$2,018.07 The first three items are not in dispute. Since we hold that Ruth's expenses for Deborah's summer trip were support, we also hold that petitioner's expenses for the trip - $128.08 - were support. As to the fifth item, the general rule is that life insurance premiums are not includable in support. Aaron F. Vance, 36 T.C. 547">36 T.C. 547 (1961). Petitioner argues that his premium is not under the rule. He claims that because of a special arrangement with the insurer his entire premium was attributable to the cost of insurance protection and that none of it built up a cash value which would ultimately redound to his benefit. We cannot accept petitioner's argument. The record is not sufficient to support his claim that the premium was solely for the cost of insurance protection. Although respondent disputes the rest of the items petitioner claims he contributed to Deborah's support, *110 it is not necessary to discuss them. Assuming, without deciding, that petitioner could prevail on all these items, the total figure for his contribution to Deborah's support in 1963 would be $1,843.95. Since this is less than the amount contributed by other persons - even excluding the undeterminable amount spent by Ruth - petitioner fails to meet the over-half requirement of section 152(a). We therefore hold that petitioner is not entitled to a dependency exemption for Deborah in 1963. Decision will be entered for the respondent. Footnotes

2011-08-23 09:34:07+00

http://bulk.resource.org/courts.gov/c/F2/732/732.F2d.939.83-4514.html

732 F.2d 939 *Credit Alliance v. Kenworth Truck Sales 83-4514 United States Court of Appeals, Fifth Circuit. 4/23/84 1 S.D.Miss. AFFIRMED 2 --------------- * Fed.R.App.P. 34(a); 5th Cir.R. 34.2.

2021-03-18 22:00:38.077032+00

https://ecf.dcd.uscourts.gov/cgi-bin/show_public_doc?2020cv0411-19

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA CRAIG STEVEN MACKENZIE, Plaintiff, v. Case No. 1:20-cv-00411 (TNM) MARCIA L. FUDGE, Secretary, U.S. Department of Housing and Urban Development, 1 et al., Defendants. MEMORANDUM OPINION Mulligans are for golf, rarely for court. Plaintiff Craig MacKenzie sues the U.S. Department of Housing and Urban Development (“HUD”), the Department of Justice (“DOJ”), and their respective agency heads in connection with a complaint he filed with HUD against the City of Dallas, Texas. Because he brought and lost the same claims in another federal court several years ago, MacKenzie cannot relitigate them here. The Court will dismiss the case. 1 Under Fed. R. Civ. P. 25(d), the Court substitutes Marcia L. Fudge, the current Secretary, for Benjamin Carson, her predecessor.  I. 2 Over a decade ago, MacKenzie and his business partner Curtis Lockey, Jr. sought to redevelop a commercial property in downtown Dallas. Compl. at 5, ECF No. 1. 3 Their joint entity—1600 Pacific Building L.P.—secured approval from the Dallas City Council as well as $102 million in financing. See U.S. ex rel. Lockey v. City of Dallas, 576 F. App’x 431, 433 (5th Cir. 2014). But the public funding quickly evaporated, and construction stalled. Id. In February 2010, 1600 Pacific Building L.P. filed a discrimination complaint with HUD under the Fair Housing Act (“FHA”). Compl. at 5–6. It alleged that the City of Dallas had intentionally impeded the project because it did not want the low-income housing development in the downtown area. Id. While HUD investigated the claim, MacKenzie and Lockey filed a False Claims Act case against Dallas in the U.S. District Court for the Northern District of Texas. Id. at 7–8. They accused Dallas of engaging in discriminatory housing practices while falsely certifying that it would “affirmatively further fair housing,” which was a condition for receiving certain federal grant money. U.S. ex rel. Lockey v. City of Dallas, Tex., No. 3:11-CV- 354-O, 2013 WL 268371 , at *3 (N.D. Tex. Jan. 23, 2013). MacKenzie and Lockey proceeded 2 For this background, the Court relies on the pleadings and their exhibits, as well as facts determined in related cases. The Court looks beyond MacKenzie’s Complaint for two reasons. First, the Government moves to dismiss on grounds that permit the Court to look outside the pleadings. See infra Section II. Second, the Court must construe a pro se Complaint together with the Plaintiff’s later filings in the case. See Brown v. Whole Foods Mkt. Grp., Inc., 789 F.3d 146 , 152 (D.C. Cir. 2015). MacKenzie appends many documents from the proceedings in Texas to his opposition to the motion to dismiss. See Pl.’s Resp. in Opp’n to Defs.’ Mot. to Dismiss Ex. 1, ECF No. 13-1. For its analysis, the Court looks outside the pleadings only when the law allows. 3 All page citations refer to the pagination generated by the Court’s CM/ECF system and all exhibit numbers refer to the numbered attachments to the CM/ECF filings. 2 with the claims after the United States declined to intervene, but the Northern District dismissed the case on jurisdictional grounds. Id. HUD concluded its investigation in November 2013 and determined that Dallas violated Title VI of the Civil Rights Act of 1964, Section 504 of the Rehabilitation Act of 1973, and Section 109 of the Housing and Community Development Act of 1974. See MacKenzie v. Castro, No. 3:15-CV-0752-D, 2016 WL 3906084 , at *1 (N.D. Tex. July 19, 2016) (“MacKenzie I”). Dallas contested the results, and after negotiations the parties reached a “Voluntary Compliance Agreement” (“VCA”). Id. Neither MacKenzie nor Lockey joined the negotiations or signed the VCA. Id. They instead withdrew their complaint with HUD, and MacKenzie, proceeding pro se, sued HUD and its leadership in the Northern District of Texas in March 2015. Id. MacKenzie alleged that HUD’s actions during the Dallas investigation “resulted in a manifest failure to administer the programs and activities . . . in a manner affirmatively to further the policies” of the FHA and “deprived him of his constitutional due process rights.” Id. (cleaned up). MacKenzie amended his complaint twice. He first added allegations that HUD violated various non-discretionary provisions of the FHA. See id. at *2 n.5. Then he added DOJ and the Attorney General as defendants, alleging that they too violated the FHA and his due process rights. See MacKenzie v. Castro, No. 3:15-CV-0752-D, 2017 WL 1021299 , at *2 (N.D. Tex. Mar. 16, 2017) (“MacKenzie II”). The Northern District dismissed all charges. In an initial order, the court found that (1) MacKenzie had not pleaded a “final agency action” under the APA for HUD’s closure of its investigation of the FHA complaint, id. at *5–6; (2) he had another “adequate remedy in a court,” which under the APA barred his claim against HUD for closure of the investigation, id. at 3 *6–8; (3) he failed to plausibly plead that HUD had to issue a charge on behalf of 1600 Pacific Building L.P. on the FHA complaint, id. at *8–9; (4) he had another adequate remedy to obtain relief for his claim that HUD failed to issue a charge against Dallas, id. at *10; and (5) he failed to state a claim that HUD violated the FHA by entering into the VCA with Dallas, id. at *11–12. MacKenzie’s claims against the DOJ defendants and his due process claims against the HUD defendants survived—but not for long. The Northern District dismissed the remaining claims in a second order. See MacKenzie v. Carson, No. 3:15-CV-0752-D, 2017 WL 5626349 (N.D. Tex. Nov. 22, 2017) (“MacKenzie III”). The court (1) dismissed MacKenzie’s procedural due process claim under Rule 12(c) because he identified no government benefit to which he had a legitimate claim of entitlement, id. at *6–8; (2) dismissed his substantive due process claim under Rule 12(c) because he failed to plausibly plead that HUD’s actions deprived him of any right, id. at *8–9; and (3) dismissed under Rule 12(b)(1) the claims against DOJ for lack of standing to pursue prospective injunctive relief, id. at *10–11. After dismissing the case with prejudice as to the HUD defendants and without prejudice as to the DOJ defendants, the court entered final judgment. Id. at *13. MacKenzie did not appeal. There is yet another case related to this matter. In February 2018, Lockey sued HUD and DOJ on substantially similar claims in the U.S. District Court for the Southern District of California. Lockey v. Carson, No. 18-cv-0344 (S.D. Cal. filed Feb. 14, 2018). The defendants moved for dismissal on several grounds, including that the judgment in MacKenzie’s Texas suit precluded Lockey’s claims seeking the same relief. See Defs.’ Mot. to Dismiss, Lockey v. Carson, No. 18-cv-0344 (S.D. Cal. Apr. 17, 2018), ECF No. 4. Without addressing the merits, the district court transferred the case to the Northern District of Texas. Transfer Order, Lockey v. Carson, No. 18-cv-0344 (S.D. Cal. Jan. 8, 2019), ECF No. 35-1. The Northern District stayed 4 proceedings while Lockey pursued relief in the U.S. Court of Appeals for the Ninth Circuit. See Elec. Order, Lockey v. Carson, No. 19-cv-0065 (N.D. Tex. June 29, 2019), ECF No. 46. Lockey failed to secure relief there, and the cases are now closed in both districts. In the meantime, MacKenzie, again proceeding pro se, filed this case in February 2020. He sues HUD, the Secretary of HUD, DOJ, and the Attorney General (collectively, “the Government”), repeating many of the same claims that he pursued in Texas and that Lockey pursued in California. See Compl. at 20–42. He alleges that HUD violated provisions of the FHA, Title VI, Section 504 of the Rehabilitation Act of 1973, and various implementing regulations. Id. at 2. He also claims that DOJ and HUD colluded to impede the investigation and ultimately to violate his due process rights. Id. at 27–29. The Government has moved to dismiss under Rules 12(b)(1) and 12(b)(6), contending that MacKenzie’s claims are precluded, and alternatively that they are beyond the statute of limitations, are inadequately pled, or rely on a faulty notion of standing. See Defs.’ Mem. of P. & A. in Support of Defs.’ Mot. to Dismiss (“Defs.’ Mem.”) at 20–30, ECF No. 7-1. The motion is now ripe for disposition. The Court has jurisdiction under 28 U.S.C. § 1331 . II. As relevant here, the Government moves to dismiss MacKenzie’s complaint as barred by the doctrine of res judicata. “When res judicata bars a claim, it is subject to dismissal under [Federal Rule of Civil Procedure] 12(b)(6).” Alford v. Providence Hosp., 60 F. Supp. 3d 118 , 123 (D.D.C. 2014). A motion to dismiss under Rule 12(b)(6) tests the legal sufficiency of the allegations so, to survive, the complaint “must contain sufficient factual matter, accepted as true, to state a claim for relief that is plausible on its face.” Ashcroft v. Iqbal, 556 U.S. 662 , 678 (2009) (cleaned up). 5  Under 12(b)(6), the Court assumes all factual allegations in the complaint are true and construes the facts “liberally in the plaintiff’s favor with the benefit of all reasonable inferences derived from the facts alleged.” Stewart v. Nat’l Educ. Ass’n, 471 F.3d 169 , 173 (D.C. Cir. 2006). But the Court will not assume the truth of legal conclusions. Iqbal, 556 U.S. at 678 . In analyzing res judicata, the Court may take judicial notice of its own record, public records from other proceedings, and documents attached as exhibits or incorporated by reference in the pleadings. See Alford, 60 F. Supp. 3d at 123–24. The Government also moves to dismiss under Rule 12(b)(1), claiming this Court lacks jurisdiction over MacKenzie’s claims because he fails to challenge a final agency action as required by the APA, see Defs.’ Mem. at 25–28, and he lacks standing to sue DOJ, see id. at 29– 30. When ruling on a motion to dismiss under Rule 12(b)(1), the Court similarly must “assume the truth of all material factual allegations in the complaint and construe the complaint liberally, granting plaintiff the benefit of all inferences that can be derived from the facts alleged.” Am. Nat’l Ins. Co. v. FDIC, 642 F.3d 1137 , 1139 (D.C. Cir. 2011) (cleaned up). But the factual allegations receive “closer scrutiny” than in the 12(b)(6) context. Delta Air Lines, Inc. v. Exp.- Imp. Bank of United States, 85 F. Supp. 3d 250 , 259 (D.D.C. 2015). And the plaintiff bears the burden of establishing by the preponderance of the evidence that the Court has jurisdiction. Grand Lodge of Fraternal Ord. of Police v. Ashcroft, 185 F. Supp. 2d 9 , 13 (D.D.C. 2001). The Court “may consider such materials outside the pleadings as it deems appropriate to resolve the question whether it has jurisdiction in the case.” Id. at 14 (cleaned up). The Court notes that MacKenzie proceeds without counsel. This triggers special solicitation for him. “A document filed pro se is to be liberally construed, and a pro se complaint, however inartfully pleaded, must be held to less stringent standards than formal 6 pleadings drafted by lawyers.” Erickson v. Pardus, 551 U.S. 89 , 94 (2007) (cleaned up). More, the Court must assess a pro se complaint “in light of all filings, including filings responsive to a motion to dismiss.” Brown, 789 F.3d at 152 (cleaned up). III. A. The Government contends that because MacKenzie brought and lost the same claims in Texas, “the doctrine of res judicata precludes him from taking a second bite at the apple.” Defs.’ Mem. at 20. The Court agrees, but with one caveat. Under res judicata (also known as claim preclusion), “a final judgment on the merits of an action precludes the parties or their privies from relitigating issues that were or could have been raised in that action.” Allen v. McCurry, 449 U.S. 90 , 94 (1980). The doctrine protects parties “from the exposure and vexation attending multiple lawsuits” and it “conserves judicial resources and fosters reliance on judicial action by minimizing the possibility of inconsistent decisions.” Apotex, Inc. v. FDA, 393 F.3d 210 , 217 (D.C. Cir. 2004) (cleaned up). A litigant cannot escape the doctrine’s effects merely by raising a new legal theory or seeking a different remedy in a new case. See SBC Commc’ns, Inc. v. FCC, 407 F.3d 1223 , 1229 (D.C. Cir. 2005). But for res judicata to preclude a claim, a litigant must have had a “full and fair opportunity” to raise it. Velikonja v. Ashcroft, 355 F. Supp. 2d 197 , 201–02 (D.D.C. 2005). So it does not apply to claims that “would have been utterly impracticable to join in an earlier suit or those that could not have been anticipated when the first suit was filed.” Id. at 201 (cleaned up). Res judicata applies when there has been “prior litigation (1) involving the same claims or cause of action, (2) between the same parties or their privies,” and (3) “a court of competent 7 jurisdiction” has (4) issued “a final, valid judgment on the merits.” Smalls v. United States, 471 F.3d 186 , 192 (D.C. Cir. 2006) (cleaned up). The Court considers each element in turn. First, do this case and the Texas case involve the same cause of action? “Whether two cases implicate the same cause of action turns on whether they share the same nucleus of facts.” Drake v. Fed. Aviation Admin., 291 F.3d 59 , 66 (D.C. Cir. 2002) (cleaned up). This is so because res judicata bars not only the legal claims actually raised in prior litigation “but also ones that a party could have raised” based on the same transaction or occurrence. NRDC. v. Thomas, 838 F.2d 1224 , 1252 (D.C. Cir. 1988). Here, there is no question that the same nucleus of facts is at issue: HUD’s investigation of Dallas and DOJ’s alleged interference in that investigation. Indeed, MacKenzie has raised some claims identical to those in the Texas case. Compare Compl. at 20–42, with MacKenzie I, 2016 WL 3906084 , at *2 n.5 (listing MacKenzie’s claims against HUD under the FHA). To be sure, MacKenzie raises many grievances about the results of the Texas action. See Pl.’s Resp. in Opp’n to Defs.’ Mot. to Dismiss (“Pl.’s Opp’n”) at 29–36, ECF No. 13. But at no point has he disputed that he did not or could not have brought all his claims then. After all, the alleged actions and inactions by the Government that underlie MacKenzie’s claims all occurred between 2010 and 2014, before MacKenzie filed his 2015 suit in Texas. Second, do these cases involve the same parties or their privies? They do. Here MacKenzie sues HUD, the Secretary of HUD, DOJ, and the Attorney General, see Compl. at 1, just as he did in Texas, see MacKenzie II, 2017 WL 1021299 , at *2. It matters not that the individuals holding the offices of Secretary and Attorney General have changed, as an official- capacity suit is treated as a suit against the government entity. See Kentucky v. Graham, 473 U.S. 159 , 166 (1985); see also Middleton v. U.S. Dep’t of Lab., 318 F. Supp. 3d 81 , 87 (D.D.C. 8 2018) (“[A] previous lawsuit against any federal agency can have a preclusive effect on all future litigation against the Government”). This element is satisfied. Third, was there a decision by a court of competent jurisdiction? Yes, and Mackenzie does not suggest otherwise. See Smalls, 471 F.3d at 192 (observing that an Article III court is a court of competent jurisdiction). Fourth, has there been a final, valid judgment on the merits? Yes. The Northern District of Texas dismissed several of MacKenzie’s claims with prejudice under Rule 12(b)(6) and 12(c). These include his allegations that HUD violated the FHA by entering into the VCA, see MacKenzie II, 2017 WL 1021299 , at *11–12 (dismissing claims under Rule 12(b)(6)), and his claims against HUD for violating his due process rights, see MacKenzie III, 2017 WL 5626349 , at *6–8 (granting judgment on the pleadings to HUD under Rule 12(c)). The rulings supported the district court’s decision to enter final judgment against MacKenzie, and it has preclusive effect. See Middleton, 318 F. Supp. 3d at 87 (“[A] previous action that resulted in a dismissal under Rule 12(b)(6) for failure to state a claim presents a ruling on the merits with a res judicata effect for the purposes of the final judgment required under Smalls.”) (cleaned up); Murchison, next friend of A.M. v. District of Columbia, No. 20-0283, 2020 WL 4569421 , at *2 (D.D.C. Aug. 7, 2020) (“A ruling on a Rule 12(c) motion is a judgment on the merits.”) (cleaned up); Haase v. Sessions, 835 F.2d 902 , 906 (D.C. Cir. 1987) (“[Rule] 12(b)(6) presents a ruling on the merits with res judicata effect”). So res judicata precludes MacKenzie from pursuing here the same claims that the Northern District dismissed under Rules 12(b)(6) and 12(c), as well any claims he could have but failed to bring then. See Thomas, 838 F.2d at 1252 . But contrary to the Government’s suggestion, see Defs.’ Mem. at 15–16, that does not cover every claim that MacKenzie raises. The Northern District dismissed some claims against 9 HUD under Rule 12(b)(1) on jurisdictional grounds; it explained that the APA waives sovereign immunity only for challenges to a “final agency action for which there is no other adequate remedy in a court,” while MacKenzie’s allegations centered on non-final actions by HUD. MacKenzie II, 2017 WL 1021299 at *4 (quoting 5 U.S.C. § 704 ); see also id. at *4–11. And the court dismissed all the claims against DOJ under Rule 12(b)(1) for lack of standing. MacKenzie III, 2017 WL 5626349 at *9–11. MacKenzie repeats some of those claims here. See Compl. 22– 40 (challenging non-final actions by HUD and accusing DOJ of interfering with the investigation). But “a jurisdictional dismissal does not involve ‘an adjudication on the merits,’” so it does not support a “final judgment” for res judicata purposes. Nat’l Ass’n of Home Builders v. E.P.A., 786 F.3d 34 , 41 (D.C. Cir. 2015). Even so, MacKenzie’s claims that survive res judicata are doomed by collateral estoppel. Also known as issue preclusion, the doctrine “bars successive litigation of an issue of fact or law actually litigated and resolved that was essential to the prior judgment, even if the issue recurs in the context of a different claim.” Id. (cleaned up). Collateral estoppel applies to jurisdictional determinations such as a standing and sovereign immunity. See Cutler v. Hayes, 818 F.2d 879 , 889 (D.C. Cir. 1987). Once a competent court dismisses a claim on jurisdictional grounds, “a second complaint cannot command a second consideration of the same jurisdictional claims,” unless circumstances have materially changed. Nat’l Ass’n of Home Builders, 786 F.3d at 41. There is no doubt that the jurisdictional issues were litigated in and resolved by the Northern 10 District, so collateral estoppel bars MacKenzie from contesting the jurisdictional determinations here. 4 The Court will dismiss all MacKenzie’s claims. 5 B. MacKenzie offers five reasons that his claims should proceed despite the prior judgment in Texas. None are persuasive. First, MacKenzie contends that res judicata does not apply to APA claims because Congress failed to codify the doctrine in the Administrative Procedure Act itself. Pl.’s Opp’n at 26–29. But courts do not need Congress’s permission to apply this common law doctrine. And circuit precedent relying on res judicata to dismiss challenges under the APA puts MacKenzie’s argument to rest. See, e.g., Smalls, 471 F.3d at 192 . Second, MacKenzie asserts that he did not have “a full and fair opportunity to litigate in the Northern District of Texas.” Pl.’s Opp’n at 29. To be sure, res judicata cannot apply against a party who did not have a fair opportunity to appear and argue his claims in prior litigation. Kremer v. Chem. Const. Corp., 456 U.S. 461 , 480 (1982). But MacKenzie’s litany of complaints about the Texas litigation do not come close to suggesting that it was so fundamentally unfair as to not merit preclusive effect. Cf. id. at 481 (looking to “the minimum procedural requirements of the Fourteenth Amendment’s Due Process Clause”). For example, he criticizes the Northern 4 It matters not that the Northern District dismissed the claims against the DOJ defendants without prejudice. “[E]ven a jurisdictional judgment that results in dismissal without prejudice may [] nevertheless have issue preclusive—if not claim preclusive—effect.” Rodriguez v. Shulman, 844 F. Supp. 2d 1 , 10 (D.D.C. 2012). 5 Having determined that MacKenzie’s claims are precluded and thus cannot proceed, the Court need not address the Government’s alternative arguments that the claims are barred by the statute of limitations or fail to state a claim. See Sinochem Int’l Co. v. Malaysia Int’l Shipping Corp., 549 U.S. 422 , 431 (2007) (“A federal court has leeway to choose among threshold grounds for denying audience to a case on the merits.”) (cleaned up). 11 District for permitting the Government to file more than one motion to dismiss and for accepting late filings by the Government. See Pl.’s Opp’n at 30–36. The Court declines MacKenzie’s invitation to scrutinize and second-guess any of those procedural rulings. MacKenzie could have appealed to the Fifth Circuit but apparently chose not to. This Court does not sit in judgment over a sister district court. Cf. City of Arlington, Tex. v. F.C.C., 569 U.S. 290 , 297 (2013) (“even an erroneous judgment is entitled to res judicata effect”). MacKenzie has provided no basis to doubt the fundamental fairness of the federal court judgment in Texas. Third, MacKenzie suggests that the Northern District’s determination that it lacked jurisdiction to address some of his claims vitiates any preclusive effect that the court’s final judgment could have. Pl.’s Opp’n 37–41. MacKenzie appears to misunderstand jurisdiction. A court may have subject matter jurisdiction to hear some claims while lacking jurisdiction to hear others. As a result, that the Northern District dismissed on jurisdictional grounds some claims against HUD and all the claims against DOJ does not mean that it lacked jurisdiction to decide any other claim on the merits. This distinction is why res judicata bars only some of MacKenzie’s claims and collateral estoppel precludes others. Fourth, MacKenzie maintains that none of his claims were adjudicated “on the merits” as the doctrine of res judicata requires because there was no trial or summary judgment determination. Pl’s Opp’n at 42–44. But recall case law makes clear that res judicata applies to dismissals under Rule 12(b)(6) and Rule 12(c). See, e.g., Haase, 835 F.2d at 906 (“[Rule] 12(b)(6) presents a ruling on the merits with res judicata effect”). MacKenzie’s confusion on this point is understandable but still wrong. Fifth, MacKenzie invokes the “curable defects exception,” arguing that it saves his claims from dismissal. Pl.’s Opp’n at 45–46. Here he has the law correct. The exception exists and 12 “allows relitigation of jurisdictional dismissals when a precondition requisite to the court’s proceeding with the original suit was not alleged or proven and is supplied in the second suit.” Nat’l Ass’n of Home Builders, 786 F.3d at 41 (cleaned up). But MacKenzie falls short in justifying why it would apply here. The exception requires a showing of “a material occurrence subsequent to the original dismissal” that “remedies” the defect. Scahill v. D.C., 909 F.3d 1177 , 1182 (D.C. Cir. 2018); see also Nat’l Ass’n of Home Builders, 786 F.3d at 41 (noting that the “exception is sharply limited” by this requirement). MacKenzie identifies no occurrence since the dismissal of his Northern District case that would justify any changes to the court’s analysis on standing or sovereign immunity. That he filed a new complaint in a new court cannot, by itself, cure any defects. MacKenzie simply seeks a different outcome than he received in Texas, but the Court must honor the previous rulings. Res judicata and collateral estoppel apply here. IV. For these reasons, the motion to dismiss will be granted. A separate Order will issue. 2021.03.18 11:25:25 -04'00' Dated: March 18, 2021 TREVOR N. McFADDEN, U.S.D.J. 13

2021-03-18 22:03:19.444649+00

http://www.illinoiscourts.gov/Opinions/AppellateCourt/2021/1stDistrict/1201264.pdf

Corrected 2021 IL App (1st) 201264 No. 1-20-1264 Opinion filed March 16, 2021 SECOND DIVISION ______________________________________________________________________________ IN THE APPELLATE COURT OF ILLINOIS FIRST DISTRICT ______________________________________________________________________________ LAIAH ZUNIGA, ) ) Plaintiff-Appellee, ) Appeal from the ) Circuit Court of v. ) Cook County. ) MAJOR LEAGUE BASEBALL, ) No. 20 L 4684 ) Defendant-Appellant ) The Honorable ) Kathy M. Flanagan, (Chicago Cubs Baseball Club, LLC, Respondent in ) Judge Presiding. Discovery-Appellant). ) ) PRESIDING JUSTICE FITZGERALD SMITH delivered the judgment of the court, with opinion. Justices Lavin and Pucinski concurred in the judgment and opinion. OPINION ¶1 In this interlocutory appeal, the defendant, Major League Baseball (MLB), and the respondent in discovery, Chicago Cubs Baseball Club, LLC (Cubs), challenge the trial court’s order denying their motion to compel binding arbitration of a personal injury claim that the plaintiff, Laiah Zuniga, filed in the Circuit Court of Cook County. For the following reasons, we affirm the order of the trial court.  No. 1-20-1264 ¶2 I. BACKGROUND ¶3 This personal injury case arises out of an incident that occurred on August 27, 2018, when the plaintiff was hit in the face by a foul ball while attending a Chicago Cubs baseball game at Wrigley Field. The supporting record indicates that the plaintiff obtained entry to Wrigley Field by presenting a paper ticket created by the Cubs’ ticket office. She had been given the ticket earlier that day by her father, who won it in a raffle at his workplace. The front of the ticket included artwork depicting one of the Cubs players; information about the opponent, the date and time of the game, the seat location, and ticket price; a barcode; and small print that stated, “Event date/time subject to change. No refund. No exchange. Subject to terms/conditions set forth on the reverse side.” ¶4 On the reverse side of the ticket, approximately one-third of the space was devoted to an advertisement. The remaining space contained six paragraphs of fine print. The first paragraph stated, “By using this ticket, ticket holder (‘Holder’) agrees to the terms and conditions available at www.cubs.com/ticketback (the ‘Agreement’), also available at the Chicago Cubs administrative office. Key terms of the Agreement are summarized below (the Agreement controls in the event of any conflict).” (Emphases in original). The third paragraph began with the word “WARNING,” used all boldface type, and included a sentence in all capital letters that baseballs might be hit into the stands, that spectators should stay alert, and that the Cubs and other entities would not be liable for resulting injuries. The fifth paragraph, in regular type, stated, “Any dispute/controversy/claim arising out of/relating to this license/these terms shall be resolved by binding arbitration, solely on an individual basis, in Chicago, Illinois. Holder and Cubs agree not to seek class arbitration or class claims and the arbitrator(s) may not consolidate more than one person’s claims.” ¶5 In an affidavit in the supporting record, the plaintiff averred that she had never read the fine -2-  No. 1-20-1264 print on the back of a ticket to a baseball game, although she had noticed advertisements. She stated that had only ever referenced tickets for game day and seating information. She averred that she had only ever attended baseball games for any team at the invitation of someone else or after receiving tickets as a gift, and she had never personally purchased tickets to a baseball game. She averred that she had never read any ticket terms and conditions, and she had never visited the website at www.cubs.com/ticketback. ¶6 The supporting record further indicates that the full terms and conditions that were available on the Cubs’ website at www.cubs.com/ticketback and at the Chicago Cubs administrative office on the day at issue included a far more comprehensive mandatory arbitration provision than what was on the back of the ticket. That provision stated in full as follows: “MANDATORY ARBITRATION AGREEMENT & CLASS ACTION WAIVER (‘ARBITRATION AGREEMENT’) The Cubs care deeply about maintaining good relationships with fans. If you have a problem with your ticket and/or those of Minor(s) or the Event, a telephone call to customer service may resolve the matter quickly and amicably. Any dispute not resolved informally must be resolved in accordance with this Arbitration Agreement. Unless prohibited by federal law, Holder and the Cubs agree to arbitrate any and all claims and disputes relating in any way to Holder’s purchase or use of this ticket and/or those of Minor(s), Holder’s and/or Minor(s)’ participation in, attendance at, and/or observation of the Event, the Agreement, and any related dealings between them, including, without limitation, claims of bodily injury or property damage arising out of Holder’s and/or Minor(s)’ attendance at and/or participation in the Event (‘Arbitration Claims’), except for Arbitration Claims concerning the validity, scope or enforceability of this Arbitration Agreement, through BINDING INDIVIDUAL ARBITRATION. This -3- No. 1-20-1264 Arbitration Agreement involves interstate commerce and shall be governed by the Federal Arbitration Act, 9 U.S.C. §§ 1-16 (‘FAA’), and not by state law. In any Arbitration Claim to be resolved by arbitration, neither Holder nor the Cubs will be able to have a court or jury trial or participate in a class action or class arbitration. Other rights that Holder and the Cubs would have in court will not be available or will be more limited in arbitration, including the right to appeal. Holder and the Cubs each understand and agree that by requiring each other to resolve all disputes through individual arbitration, WE ARE EACH WAIVING THE RIGHT TO A COURT OR JURY TRIAL. ALL DISPUTES SHALL BE ARBITRATED ON AN INDIVIDUAL BASIS, AND NOT AS A CLASS ACTION, REPRESENTATIVE ACTION, CLASS ARBITRATION OR ANY SIMILAR PROCEEDING. The arbitrator(s) may not consolidate the claims of multiple parties. Arbitrations shall be administered by the American Arbitration Association (‘AAA’) pursuant to the applicable AAA rules in effect at the time the arbitration is initiated. You may obtain information about arbitration, arbitration procedures and fees from AAA by calling 800-778-7879 or visiting www.adr.org. If AAA is unable or unwilling to arbitrate a dispute, then the dispute may be referred to any other arbitration organization or arbitrator the parties both agree upon in writing or that is appointed pursuant to section 5 of the FAA. The arbitration shall take place in the city where the Ballpark is located. The arbitrator shall be authorized to award any relief that would have been available in court, provided that the arbitrator’s authority is limited to Holder and the Cubs alone, except as otherwise specifically stated herein. No arbitration decision will have any preclusive effect as to non- parties. The arbitrator’s decision shall be final and binding. The parties agree that this -4- No. 1-20-1264 Arbitration Agreement extends to any other parties involved in any Arbitration Claims, including, but not limited to, Minor(s) and the Released Parties. This Arbitration Agreement shall take precedence over the rules of the arbitration organization or arbitrator in the event of any conflict. The Cubs will be responsible for paying all arbitration fees other than the amount of filing fees Holder would have incurred in the state or federal court where the Event took place, whichever is less. Notwithstanding any other provision herein, Holder and the Cubs may seek relief in a small claims court for Arbitration Claims within its jurisdiction. In addition, Holder and the Cubs each may exercise any lawful rights to seek provisional remedies or self-help, without waiving the right to arbitrate by doing so. Notwithstanding any other provision of the Agreement, if the foregoing class action waiver and prohibition against class arbitration is determined to be invalid or unenforceable, then this entire Arbitration Agreement shall be void. If any portion of this Arbitration Agreement other than the class action waiver and prohibition against class arbitration is deemed invalid or unenforceable, it shall not invalidate the remaining portions of this Arbitration Agreement. This Arbitration Agreement will survive the termination of the Agreement, the conclusion of the Event, and/or the bankruptcy or insolvency of a party (to the extent permitted by applicable law). YOU HAVE THE RIGHT TO REJECT THIS ARBITRATION AGREEMENT, BUT YOU MUST EXERCISE THIS RIGHT PROMPTLY. If you do not wish to be bound by this agreement to arbitrate, you must notify us by mailing a written opt-out notice, postmarked within seven (7) days after the date of the Event. You must send your request to: Chicago Cubs Baseball Club, LLC, Attn: Office of the General Counsel, Re: Arbitration -5- No. 1-20-1264 Opt Out, 1060 West Addison Street, Chicago, IL 60613. The request must include your full name, address, account number, and the statement ‘I reject the Arbitration Agreement contained in my Event Ticket.’ If you exercise the right to reject arbitration, the other terms of the Agreement shall remain in full force and effect as if you had not rejected arbitration. Prior to initiating a lawsuit or an arbitration proceeding under this Arbitration Agreement, the Claimant shall give the other party or parties written notice of the Arbitration Claim (a ‘Claim Notice’) and a reasonable opportunity, not less than 30 days, to resolve the Arbitration Claim. Any Claim Notice to one or more of the Cubs shall be sent by mail to Chicago Cubs Baseball Club, LLC, Attn: Office of the General Counsel, Re: Arbitration Claim, 1060 West Addison Street, Chicago, IL 60613. Any Claim Notice must (a) identify the Claimant by name, address, email address, and telephone number; (b) explain the nature of the Arbitration Claim and the relief demanded; and (c) be submitted only on behalf of the Claimant, and not on behalf of any other party. The Claimant must reasonably cooperate in providing any information about the Arbitration Claim that the other party reasonably requests and must give the other party a reasonable opportunity to respond to the demand for relief. IF MINOR(S) IS/ARE ACCOMPANYING HOLDER TO THE EVENT, HOLDER IS DEEMED TO HAVE AGREED TO THIS ARBITRATION AGREEMENT ON BEHALF OF SUCH MINOR(S) AS THEIR PARENT OR GUARDIAN OR AS THE AUTHORIZED AGENT OF THEIR PARENT OR GUARDIAN. IF HOLDER DOES NOT WISH TO OR IS NOT AUTHORIZED TO MAKE SUCH AGREEMENT ON BEHALF OF THE ACCOMPANIED MINOR(S), HOLDER SHOULD IMMEDIATELY LEAVE THE BALLPARK WITH THE MINOR(S).” (Emphases in original). -6-  No. 1-20-1264 ¶7 According to the plaintiff’s affidavit, she was sitting at her seat at the ballpark, eating a sandwich that she had purchased there, when she was struck in the face by a foul ball traveling at a high rate of speed. She sustained serious injuries to her head and face, including facial fractures. She spent four days hospitalized and then returned home, where she continued to rest and take pain medication as ordered by her physician. During that time, she did not engage in reading or any other eye-straining activity, pursuant to her doctor’s orders. She could not work for a period of two weeks after being injured. She averred that prior to hiring a lawyer, she was unfamiliar with the word “arbitration,” and that if she had known that it meant she lost her right to pursue a jury trial in court for her injuries, she would have understood to opt out of the arbitration provision within seven days of the event in which she was injured. She also averred that she had no “account number” with MLB or the Cubs as required to complete the opt-out process. ¶8 After the plaintiff filed the complaint at law in circuit court, MLB and the Cubs filed a motion to compel binding arbitration of the plaintiff’s claim. The motion itself is not included in the supporting record. The plaintiff filed a response, in which she did not dispute that a contract existed between herself and the Cubs. Instead, she first argued that the arbitration provision was inapplicable because the Cubs were named only a respondent in discovery in the case and MLB was neither a party to the agreement nor a third-party beneficiary of it. Second, she argued that the terms and conditions of the ticket and the arbitration provision were unconscionable and unenforceable because they were set forth on the ticket in tiny type that did nothing to highlight the importance of the arbitration provision or need to visit a separate website to ascertain the full terms and conditions being agreed to. She argued that it was too onerous to expect a ticketholder to notice the website address on the ticket and then use a device with Internet access to find and read the full text of the terms and conditions. -7-  No. 1-20-1264 ¶9 In a written order, the trial court rejected the plaintiff’s first argument, finding that the arbitration agreement applied to MLB. However, the trial court accepted the plaintiff’s second argument and found that the arbitration provision was procedurally unconscionable because it was so difficult to find, read, or understand that it could not fairly be said that the plaintiff was aware of what she was agreeing to. The trial court’s reasoning for its determination is explained in greater detail in the analysis below. Based on the trial court’s finding of procedural unconscionability with respect to the arbitration provision, the trial court denied the motion by MLB and the Cubs to compel arbitration. MLB and the Cubs then filed this interlocutory appeal of the trial court’s order. ¶ 10 II. ANALYSIS ¶ 11 This appeal involves the denial of a motion to compel arbitration. We first address the standard of review. The plaintiff argues that this court should review the trial court’s order for abuse of discretion, asserting that the trial court made factual findings and resolved disputed facts in determining that the arbitration provision was procedurally unconscionable. However, we agree with the contention of MLB and the Cubs that a de novo standard of review is appropriate because the trial court denied the motion to compel arbitration without conducting an evidentiary hearing, the underlying facts were not in dispute, and the trial court’s order involved applying the law to undisputed facts. QuickClick Loans, LLC v. Russell, 407 Ill. App. 3d 46 , 52 (2011). Further, this appeal involves the question of whether a contract provision is unconscionable, which is a question of law reviewed de novo. Kinkel v. Cingular Wireless, LLC, 223 Ill. 2d 1 , 22 (2006). ¶ 12 The issue in this appeal is whether the arbitration provision upon which MLB and the Cubs rely, which is included in the terms and conditions as set forth on the Cubs’ website or at its administrative office and is summarized on the reverse side of the paper ticket used by the plaintiff, is unenforceable under the doctrine of procedural unconscionability. We are not deciding the -8-  No. 1-20-1264 broader question of whether the plaintiff entered into a contract with the Cubs by using the ticket to enter Wrigley Field to attend the baseball game. The plaintiff did not dispute the issue of contract formation in the trial court, and therefore, we limit our review to the question of the unconscionability of a specific provision of the parties’ contract. ¶ 13 We begin by acknowledging that contractual agreements to submit disputes to arbitration are favored as a matter of both state and federal law. QuickClick Loans, LLC, 407 Ill. App. 3d at 52. However, arbitration is a matter of contract, and a party cannot be forced to arbitrate a dispute that the party has not agreed to submit to arbitration. Roubik v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 181 Ill. 2d 373 , 382 (1998). The question of whether parties to a dispute have contractually agreed to submit that dispute to arbitration is determined according to principles of state contract law. Bess v. DirecTV, Inc., 381 Ill. App. 3d 229 , 234 (2008). An arbitration agreement may be invalidated by a state law contract defense of general applicability, such as fraud, duress, or unconscionability. Carter v. SSC Odin Operating Co., 2012 IL 113204 , ¶ 18. ¶ 14 The trial court here relied upon the doctrine of procedural unconscionability to find that the arbitration provision here was unenforceable. A contract term can be invalidated on the basis of “substantive” unconscionability, “procedural” unconscionability, or a combination of both. Razor v. Hyundai Motor America, 222 Ill. 2d 75 , 99 (2006). Substantive unconscionability exists when contract terms are inordinately one-sided in one party’s favor. Id. at 100 . Procedural unconscionability exists when a contract term is so difficult to find, read, or understand that the plaintiff cannot fairly be said to have been aware that he or she was agreeing to it. Kinkel, 223 Ill. 2d at 22 . The doctrine has been explained as follows: “ ‘Procedural unconscionability consists of some impropriety during the process of forming the contract depriving a party of a meaningful choice. [Citations.] Factors to be -9-  No. 1-20-1264 considered are all the circumstances surrounding the transaction including the manner in which the contract was entered into, whether each party had a reasonable opportunity to understand the terms of the contract, and whether important terms were hidden in a maze of fine print; both the conspicuousness of the clause and the negotiations relating to it are important, albeit not conclusive factors in determining the issue of unconscionability. [Citation.] To be a part of the bargain, a provision limiting the defendant’s liability must, unless incorporated into the contract through prior course of dealings or trade usage, have been bargained for, brought to the purchaser’s attention or be conspicuous. *** Nor does the mere fact that both parties are businessmen justify the utilization of unfair surprise to the detriment of one of the parties ***. [Citation.] This requirement that the seller obtain the knowing assent of the buyer “does not detract from the freedom to contract, unless that phrase denotes the freedom to impose the onerous terms of one’s carefully drawn printed document on an unsuspecting contractual partner. Rather, freedom to contract is enhanced by a requirement that both parties be aware of the burdens they are assuming. The notion of free will has little meaning as applied to one who is ignorant of the consequences of his acts.” [Citations.]’ ” Id. at 23-24 (quoting Frank’s Maintenance & Engineering, Inc. v. C.A. Roberts Co., 86 Ill. App. 3d 980 , 989-90 (1980)). The doctrine protects individual consumers who contract with commercial entities at least as much as it protects businesses that contract with other businesses. Id. at 24. ¶ 15 Factors making a court more likely to find unconscionability include the involvement of a consumer, a disparity in bargaining power, and the presence of the allegedly unconscionable provision on a preprinted form. Id. However, as MLB and the Cubs point out, a provision contained in a consumer contract will not be found procedurally unconscionable merely because a - 10 -  No. 1-20-1264 business sought to impose it through a standardized, take-it-or-leave-it contract over which the consumer had no ability to negotiate (i.e., a contract of adhesion). Zobrist v. Verizon Wireless, 354 Ill. App. 3d 1139 , 1148 (2004). Likewise, a provision will not be found procedurally unconscionable merely because it is presented in fine print or uses legal language that an average consumer might not fully understand. Tortoriello v. Gerald Nissan of North Aurora, Inc., 379 Ill. App. 3d 214 , 233 (2008). Contracts with these characteristics are “a fact of modern life.” Kinkel, 223 Ill. 2d at 26 . “Consumers routinely sign such agreements to obtain credit cards, rental cars, land and cellular telephone service, home furnishings and appliances, loans, and other products and services,” without those characteristics giving rise to a finding of procedurally unconscionability. Id.; Phoenix Insurance Co. v. Rosen, 242 Ill. 2d 48 , 72 (2011). Rather, there must be “[s]ome added coercion or overreaching” beyond these characteristics for a court to find that a contractual provision is procedurally unconscionable. Tortoriello, 379 Ill. App. 3d at 233. Also, even an arbitration clause that is difficult to find or hidden in a maze of fine print may still be considered part of the parties’ bargain if it is brough to the consumer’s attention, either elsewhere in the contract or by other means. Id. ¶ 16 The doctrine of procedural unconscionability has been applied by the supreme court to invalidate a clause in a car warranty excluding consequential damages, based on evidence showing that the warranty was printed only in the car’s owner manual located inside the car’s glovebox and unavailable to the plaintiff until after she signed the purchase contract for the car. Razor, 222 Ill. 2d at 100-01 . In Kinkel, the supreme court held that an arbitration clause included in the fine print of the terms and conditions on the back of a preprinted cellular service agreement filled with text was not procedurally unconscionable, where the plaintiff had signed the contract, initialed an acknowledgement on it that she had read its terms and conditions, and had those terms and - 11 -  No. 1-20-1264 conditions in her possession to read if she had chosen to do so. Kinkel, 223 Ill. 2d at 26 . However, the court did find a “degree of procedural unconscionability” in the fact that key information about the costs of the arbitration was not explained in the contract, but rather the contract merely incorporated this information by reference through a statement that information about costs was available “ ‘upon request.’ ” Id. at 27 . ¶ 17 In Frank’s Maintenance & Engineering, 86 Ill. App. 3d at 991-92, the doctrine was applied outside the consumer context to invalidate a provision on the back of a purchase acknowledgement limiting the remedies available to purchasers, where a notice on the front of the purchase acknowledgement directing purchasers to the conditions on the back had been stamped over, rendering it illegible and indicating that it could be disregarded. In Timmerman v. Grain Exchange, LLC, 394 Ill. App. 3d 189 , 196-97 (2009), the doctrine was used to prevent the defendants from relying on a trade association rule to compel arbitration, where their contracts with the plaintiffs (who were not members of the trade association) stated that the contracts were subject to those rules but did not mention arbitration or set forth the rules; the plaintiffs were also not given copies of the trade association rules or told where they could be found. In Wigginton v. Dell, Inc., 382 Ill. App. 3d 1189 , 1193-94 (2008), the court found that a provision prohibiting class arbitration of disputes was “at least somewhat procedurally unconscionable,” where a plaintiff who purchased computer equipment by telephone had not seen Dell’s terms and conditions prior to purchasing it, and returning the equipment to reject the provision after receiving it was far more onerous than choosing beforehand to purchase from a different supplier. ¶ 18 Thus, in each of the above cases where procedural unconscionability was found, in whole or in part, there was some factor that made the relevant contract term difficult or onerous for the non- drafting party to find or obtain at the time of contracting, such that it could not fairly be said that - 12 -  No. 1-20-1264 the non-drafting party to the contract was aware of what he or she was agreeing to. ¶ 19 In this case, the trial court found that the arbitration provision upon which MLB and the Cubs relied was procedurally unconscionable and unenforceable, based upon the following factors: (1) the plaintiff did not purchase the ticket, and she did negotiate or bargain for the terms of the agreement; (2) the type on the front of the ticket directing the ticketholder to the terms and conditions on the back was “inconspicuous and very difficult to see”; (3) the type used in the summary of terms on the back of the ticket was “extremely small and difficult to read”; (4) the summary of the terms and conditions on the back of the ticket discussed a variety of topics and addressed arbitration only at the bottom without separating, bolding, or setting that provision apart in any way; (5) the extent of the summary of the arbitration provision was a statement that “ ‘any dispute/controversy/claim arising out of/relating to this license/these terms shall be resolved by binding arbitration, solely on an individual basis’ ”; and (6) the top of the back of the ticket stated that the ticket holder agreed to the terms in conditions available on the website without stating that the full arbitration agreement was located there or referencing the website again near the bottom of the ticket where arbitration is addressed. The trial court concluded that the arbitration provision was effectively “hidden in a maze of fine print, unable to be appreciated by the Plaintiff.” The trial court found that the circumstances surrounding the agreement and the size and location of the portion addressing arbitration “raise significant doubts as to whether the Plaintiff had a meaningful opportunity to become aware of, let alone agree to, the terms of the arbitration clause.” ¶ 20 On appeal, MLB and the Cubs argue that the trial court erred in finding that the arbitration provision was procedurally unconscionable. They argue that the trial court placed too much emphasis on the small size of the type used on the ticket. They contend that, despite being in small type, the notice on the front of the ticket and the terms and conditions summarized on the back of - 13 -  No. 1-20-1264 it (and available in full on the Cubs website) used clear and simple language and were legible and conspicuous enough to afford the plaintiff a reasonable opportunity to review and understand what she was agreeing to. They rely on the fact that the front of the ticket contained only two lines of text, which they argue was clear and conspicuous enough to put the plaintiff on notice that her attendance at Wrigley Field was “[s]ubject to terms/conditions set forth on the reverse side.” They contend that the agreement was not hidden in a maze of fine print, citing the fact that the first full sentence of the back of the ticket stated that by using the ticket, she was agreeing to the terms and conditions available on the Cubs website. They point out that the back of the ticket contained fewer than 650 words, that more than 50 of them were directed to the topic of arbitration, and that the topic is spelled out in a separate paragraph. They argue that neither the notice on the front of the plaintiff’s ticket nor the terms and conditions summarized on the back were in any way illegible or misleading. ¶ 21 We agree with the conclusion reached by the trial court and hold that the arbitration provision at issue is procedurally unconscionable. As with the cases discussed above, factors exist in this case that make the arbitration provision difficult or onerous to find or obtain at the time of using the ticket, such that we cannot fairly say that the plaintiff was aware of what she was agreeing to. Principal among these factors is the fact that the paper ticket possessed by the plaintiff did not contain the actual terms and conditions of the contract, but merely contained a summary of the terms and conditions and informed ticket holders that they had to either access a website or visit the Cubs’ administrative offices to obtain and read the full terms and conditions they were purportedly agreeing to, including the 8-paragraph arbitration provision. And the context in which a ticket holder is being directed to do this is not one where he or she is already using the Internet and can merely click on a hyperlink to access and read those terms and conditions. Instead, a ticket - 14 -  No. 1-20-1264 holder, who is quite likely in the commotion outside the baseball stadium at the time he or she looks at the ticket, would then need to use a device to access the Internet, manually type in the website address, and then read on that device terms and conditions that, when printed, comprise four-and-a-half single-spaced pages of the supporting record. The need to take these extra steps in the context of attending a baseball game greatly diminishes the ease with which a ticketholder can actually read the arbitration provision to which he or she is purportedly agreeing by using the ticket. Also, a ticket-holder may not even have a cellular phone with Internet access or coverage sufficient to access the Internet at the ballpark, and the option to obtain the full terms and conditions from the Cubs’ administrative office would seem even more onerous than accessing a website, since the ticket does not inform the ticketholder where that office may be found. ¶ 22 The likelihood that a ticket holder will actually find, obtain, and read the full arbitration provision by accessing the Cubs’ website or visiting the administrative office is diminished even further by the fact that minimal effort is made on the ticket itself to draw a ticket holder’s attention to the need to do one of these things in order to understand that they are agreeing to binding arbitration by using the ticket to enter Wrigley Field. The front of the ticket states, “Subject to terms/conditions set forth on reverse side.” This notice is conspicuous in that it is one of only two lines of text on the front of the ticket, and it is printed in black type set against the white background of the ticket itself. However, the notice is inconspicuous in that it is printed in very small type. We take judicial notice that the court’s Adobe Acrobat software indicates that the ticket template provided by the Cubs uses four-point font for this notice. And importantly, nothing about this notice draws a ticketholder’s attention specifically to the fact that he or she is agreeing to give up important legal rights by using the ticket or to the need to read the terms and conditions to understand the legal rights that he or she is waiving by using the ticket. - 15 -  No. 1-20-1264 ¶ 23 The back side of the ticket is composed of six paragraphs of text and several capitalized headings using the same four-point font. These six paragraphs are not the actual terms and conditions being agreed to, but the summary of the terms and conditions. The ticket states that by using the ticket, the “ticket holder (‘Holder’) agrees to the terms and conditions available at www.cubs.com/ticketback (the ‘Agreement’).” (Emphasis in original.) Significantly, the website address is in plain type and not set apart in underlined, bolded, italicized, or different-colored type as website addresses usually are. Thus, while the words “Holder” and “Agreement” in the same sentence are emphasized, nothing draws a ticket user’s attention to the separate website address that must be visited to read the full terms and conditions being agreed to. ¶ 24 Further, although many words and provisions on the back of the ticket are emphasized in bold type, in all capital letters, or with introductory words such as “WARNING,” the summary pertaining to the topic of arbitration is not emphasized in any way. The summary pertaining to arbitration is in the fifth of six full paragraphs addressing various topics. It uses rather dense legal language to summarize the arbitration provision—“Any dispute/controversy/claim arising out of/relating to this license/these terms shall be resolved by binding arbitration, solely on an individual basis, in Chicago, Illinois”—while omitting any explanation that this means that a person who uses a ticket is giving up his or her legal right to a jury trial in court of any claim involving the Cubs or MLB. The brief summary on the back of the ticket also omits any indication that the full arbitration provision being agreed to on the Cubs website is a far more comprehensive, eight-paragraph arbitration provision. The summary also omits any reference to the significant fact a ticketholder has the right to opt-out of this arbitration provision if he or she mails a written opt- out notice within seven days. ¶ 25 None of these factors discussed in the preceding paragraphs appear designed to have the - 16 -  No. 1-20-1264 effect of actually causing a reasonable consumer in the plaintiff’s position to learn of and read the full arbitration provision to which he or she is purportedly assenting by using a baseball ticket to enter Wrigley Field. Instead, the totality of circumstances make this appear as more of an effort to “ ‘impose the onerous terms of one’s carefully drawn printed document on an unsuspecting contractual partner.’ ” Kinkel, 223 Ill. 2d at 23 (quoting Frank’s Maintenance & Engineering, 86 Ill. App. 3d at 989-90). ¶ 26 One of the procedural unconscionability factors that we find especially important in this case is “ ‘the manner in which the contract was entered into.’ ” Id. (quoting Frank’s Maintenance & Engineering, 86 Ill. App. 3d at 989-90). This case is different from most cases addressing procedural unconscionability because the plaintiff here allegedly assented to this arbitration provision by her conduct. In other words, the way by which MLB and the Cubs contend that the plaintiff assented to the arbitration provision was by presenting a paper baseball ticket to be scanned so that she could gain entry into Wrigley Field to attend a Cubs game. This is not a traditional method of forming a contract, and it is not an act that would necessarily cause a reasonable consumer to realize that he or she was agreeing to the terms and conditions of a contract. Although nothing about the fact that this contract was formed through conduct preludes a finding that the plaintiff assented to arbitration (see James v. McDonald’s Corp., 417 F.3d 672 , 677-78 (7th Cir. 2005)), we must at least be satisfied that the circumstances alerted the plaintiff to the contractual effect that her conduct would have. ¶ 27 No party directs our attention to any case involving the sufficiency or enforceability of an arbitration or similar provision included in the terms or conditions printed on or incorporated by reference into a ticket used to attend a baseball game or similar event. The plaintiff relies on Yates v. Chicago National League Ball Club, Inc., 230 Ill. App. 3d 472 , 487 (1992), in which this court - 17 -  No. 1-20-1264 affirmed a trial court’s evidentiary ruling that a defendant could not argue at trial that the plaintiff had contractually assumed the risk of being hit by a baseball based on his use of a ticket that had a disclaimer of liability printed on the back. However, Yates is inapposite to the issue before us because the basis of the trial court’s ruling was that the ticket’s print was so small that it could not be legibly reproduced on the photocopy submitted to the trial court. Id. Yates did not involve the issue of unconscionability or whether the small print prevented enforcement of the provision. The case did, however, cite to comment c of the Restatement (Second) of Torts involving the doctrine of express assumption of risk. Id. (citing Restatement (Second) of Torts § 496B, cmt. c, illus. 1 (1977)). While that doctrine is not involved here, the comment makes a point concerning assent that we find pertinent to this case. It states that, where a plaintiff’s conduct is merely that of a recipient of a preprinted agreement drawn by the defendant (such as a ticket), it must appear that “the terms were in fact brought home to him” before he can be found to have accepted them. Restatement (Second) of Torts § 496B, cmt. c (1965). Here, as previously discussed, we cannot say that the circumstances in fact “brought home” to the plaintiff the fact that she was accepting the full arbitration agreement by her conduct of using the baseball ticket. ¶ 28 Given how the contract was formed here, this case is not the equivalent of a case involving a signed contract or an internet transaction. In cases where consumers sign contracts, courts generally hold that they are charged with knowledge of and assent to the terms and conditions of a contract they have signed. See Melena v. Anheuser-Busch, Inc., 219 Ill. 2d 135 , 150 (2006). Thus, in Kinkel, relied upon by the Cubs and MLB, the arbitration provision was held not to be unconscionable—even though it was contained in the fine print of the terms and conditions on the back of a preprinted cellular service agreement filled with text—because the plaintiff had signed the contract, initialed an acknowledgement on it that she had read the terms and conditions, and - 18 -  No. 1-20-1264 had them in her possession to read if she had chosen to do so. Kinkel, 223 Ill. 2d at 26 . If the plaintiff had signed a contract here containing the terms and conditions at issue, that would make this a different case. But there is no contract here containing the plaintiff’s signature, and she cannot be charged with having assented to the arbitration provision on that basis. Also, unlike Kinkel, the full terms and conditions were not in the plaintiff’s possession by virtue of the paper ticket she had; rather, she was required to access the Cubs’ website or visit the administrative office to read them. Imposing the need to take one of these these extra steps to ascertain the full terms and conditions being agreed to makes this more like the provision of the Kinkel contract directing a consumer to “request” information about arbitration costs, which the supreme court held was a degree of procedural unconscionability. Id. at 27 . ¶ 29 Likewise, the contract here is not one associated with an internet or other electronic transaction during which a consumer has electronically clicked a button or checked a box confirming that he or she agrees to certain terms or condition as part of that electronic transaction, which courts uphold as agreements because they both give the consumer an opportunity to review the terms and conditions and require a physical manifestation of assent by the consumer. See Wilson v. Redbox Automated Retail, LLC, 448 F. Supp. 3d 873 , 882 (N.D. Ill. 2020) (citing Applebaum v. Lyft, Inc., 263 F. Supp. 3d 454 , 465 (S.D.N.Y. 2017)). In cases where consumers are prompted to electronically click buttons agreeing to terms and conditions during Internet or electronic transactions, this procedure puts them on notice that their further Internet or electronic conduct is subject to the terms and conditions established by the owner of the website. If the plaintiff had done anything like that, this would be a different case. However, nothing analogous to this occurred here that required some act by the plaintiff acknowledging that her attention had been drawn to the fact that her conduct of using the ticket was an acknowledgement that she was - 19 -  No. 1-20-1264 agreeing to the full arbitration provision in the terms and conditions. ¶ 30 MLB and the Cubs argue that this case should be treated as analogous to Hubbert v. Dell Corp., 359 Ill. App. 3d 976 , 983-84 (2005), in which the court, applying Texas law, held that the plaintiffs’ act of purchasing computers through Dell’s website constituted their agreement to an arbitration provision included in Dell’s terms and conditions. Dell’s website did not require users to click an “I accept” box to manifest assent to the terms and conditions before completing the purchase. Id. at 983. However, completing a purchase required the plaintiffs to complete online forms on five pages of the website, and each of those five pages contained a hyperlink to Dell’s terms and conditions. Id. at 979. The court reasoned that the hyperlinks on the five website pages “should be treated the same as a multipage written paper contract,” as the hyperlink “simply takes a person to another page of the contract, similar to turning the page of a written paper contract.” Id. at 984. The court further found that although there was no conspicuousness requirement, “the hyperlink’s contrasting blue type makes it conspicuous.” Id. The court also recognized that the plaintiffs were not novices at computer use and knew that clicking the hyperlink would take them to the terms and conditions. Id. The court further relied on the fact that three of the five website pages stated that all sales were subject to Dell’s terms and conditions, and it held that this statement, combined with the fact that the terms and conditions were accessible from all pages by hyperlinks, provided sufficient notice to the plaintiffs that purchasing the computers online would make the terms and conditions binding on them. Id. ¶ 31 MLB and the Cubs argue that the arbitration agreement here is more conspicuous than the one in Hubbert because arbitration is referenced on the ticket itself and not in a separate document. However, while we recognize that the ticket mentions arbitration, it does so merely as a one- sentence summary of the eight-paragraph arbitration provision available only on the Cubs’ website - 20 -  No. 1-20-1264 or at the administrative office. To read the full arbitration provision being agreed to, a ticket holder must reference a completely separate document, either by accessing the Cubs’ website or by obtaining it at the administrative offices. Unlike in Hubbert, the paper ticket that the plaintiff was using here provided her with no ability to access the full terms and conditions being agreed to simply by clicking a hyperlink while she was already using the internet. Because of this, we cannot say in this case that the plaintiff’s paper ticket “should be treated the same as a multipage written paper contract.” Id. at 984. Also, in Hubbert, the hyperlink was in a contrasting blue type that made it conspicuous, whereas here the website address was printed in plain type that did nothing to draw a ticketholder’s attention to its existence. Hubbert is further distinguishable because there, it is evident that the existence of the terms and conditions was brought to the attention of the plaintiffs by the fact that they had to read and complete online forms on five website pages in order to complete their purchases, and the terms and conditions were available from those website pages by hyperlink. There is no analogous requirement in this case that the plaintiff ever had to read her baseball ticket or the Cubs’ website in order to use that ticket to enter the stadium. For all of these reasons, we find Hubbert to be inapposite to the facts of this case. ¶ 32 MLB and the Cubs argue in a footnote that the contract cannot be considered unenforceable merely because it is a contract of adhesion over which the plaintiff had no opportunity to negotiate the terms. They point to the supreme court’s statement that “adhesive contracts ‘are a fact of modern life.’ ” Phoenix Insurance Co., 242 Ill. 2d at 72 (quoting Kinkel, 223 Ill. 2d at 26 ). To be clear, our finding that the arbitration provision is unconscionable is not based on the fact that it is imposed in a contract of adhesion or that the plaintiff had no ability to negotiate its terms. Zobrist, 354 Ill. App. 3d at 1148. Nor is our finding based on the use of fine print or use of legal language that is difficult to understand. Tortoriello, 379 Ill. App. 3d at 233. Rather, our finding is based on - 21 -  No. 1-20-1264 the fact that there is “overreaching” that goes beyond a business merely imposing an arbitration provision on a consumer by using a contract of adhesion with fine print and legal language that the consumer might not understand. Id. The overreaching is the fact that the Cubs sought to bind the plaintiff, merely through her use of a baseball ticket to enter Wrigley Field, to an extensive eight-paragraph arbitration provision that was not provided to her, which she could read only by either accessing the Cubs’ website (while likely being in the commotion outside the baseball stadium when she recognizes the need to do this, where it is not necessarily easy or practical to read an Internet website) or by visiting the Cubs’ administrative office (despite her ticket containing no information about where that office could be found). The Cubs sought to impose this provision on her, despite the fact that the ticket did very little to draw the plaintiff’s attention to the importance of accessing the website or the administrative offices to understand the comprehensive extent of the arbitration provision she was agreeing to by using the ticket or the fact that she could opt out of arbitration within seven days of the game, while simultaneously emphasizing other aspects of the summarized terms and conditions. ¶ 33 In a second footnote, MLB and the Cubs argue that the plaintiff’s ticket was a license to attend the game and that the Cubs had the ability to establish terms and conditions under which the plaintiff could do so. They cite this court’s decision in Soderholm v. Chicago National League Ball Club, Inc., 225 Ill. App. 3d 119 , 124-25 (1992), which involved the issue of what rights a season ticket holder had against the ticket seller to purchase tickets in future seasons. In rejecting the argument that the purchase of season tickets was a lease instead of a series of revocable licenses, the court stated, “Neither an individual ticket holder nor a season ticket holder is entitled to enter the ball park except upon the terms and conditions specified on the individual tickets and by defendant’s policies.” Id. at 125. MLB and the Cubs then also cite ProCD, Inc. v. Zeidenberg, - 22 -  No. 1-20-1264 86 F.3d 1447 , 1451 (7th Cir. 1996), for its statement that use of an airline ticket or a concert ticket is acceptance of its terms, even terms that in retrospect are disadvantageous, and they argue that the same principle applies here. However, we note that not all terms and conditions affecting the parties’ legal relationship are enforceable merely because they are printed on the back of an airline ticket, concert ticket, or the like. Courts generally employ a “reasonable communicativeness” test with airline tickets or similar tickets to determine whether the ticket reasonably communicates to the passenger the existence of important terms and conditions that affect the passenger’s legal rights, so as to bind the passenger to them. Deiro v. American Airlines, Inc., 816 F.2d 1360 , 1363- 65 (9th Cir. 1987); see Walker v. Carnival Cruise Lines, Inc., 383 Ill. App. 3d 129 , 134 (2008) (cruise ship ticket). ¶ 34 That test first takes into account whether the physical characteristics of the ticket reasonably communicate the existence of the terms and conditions at issue, considering factors such as the conspicuousness of the clause at issue, the size of type used, the clarity of the terms, and the ease with which a passenger can read the terms at issue. Walker, 383 Ill. App. 3d at 134-35. These factors are similar to those that we discussed above and which led us here to conclude that nothing about the physical characteristics of the ticket here appeared designed to actually impress upon a ticketholder the importance of visiting the Cubs’ website or administrative offices to read the arbitration provision to which he or she was agreeing by using the baseball ticket. Supra ¶¶ 22-25. Second, the reasonable communicativeness test considers whether the circumstances surrounding the passenger’s purchase and retention of the ticket permitted him or her to become meaningfully informed of its contractual terms, taking into account factors such as the passenger’s familiarity with tickets, the time and incentive to study the provisions of the ticket contract, and any other notice that the passenger received regarding the ticket contract provisions. Walker, 383 Ill. App. - 23 -  No. 1-20-1264 3d at 134-35. In this case, the evidence is that the plaintiff had no prior familiarity with the terms or conditions of baseball tickets, and MLB and the Cubs identify nothing outside the physical ticket itself that notified the plaintiff of the arbitration provision. She was given the ticket by her father on the same day of the game, and we doubt that she can be charged with having a strong incentive to study the provisions of the contract merely to attend a baseball game. Cf. Diero, 816 F.2d at 1365 (airline passenger checking baggage worth a quarter million dollars charged with knowledge of contract terms due to the strong incentive he had to read ticket terms about airline’s liability for checked baggage and nine days in which to do so). And, as we discussed above (supra ¶ 21), the hassle of needing to use a device with Internet access to visit the Cubs’ website while at the commotion of the ballpark or to visit the Cubs’ administrative office to read the full terms and conditions is a circumstance that gives ticketholders little realistic ability to become meaningfully informed of the full arbitration provision that they are agreeing to by using the ticket. Thus, we would not reach the conclusion here that the plaintiff’s baseball ticket reasonably communicated the existence and importance of the legal rights being affected by her use of the ticket. ¶ 35 To be sure, we take no issue with the above-quoted statement in Soderholm or the general proposition that the Cubs can establish terms and conditions under which patrons can attend games. Soderholm, 225 Ill. App. 3d at 124-25. There may be ways in which the Cubs can have all persons using tickets contractually agree to binding arbitration as a term of condition of entry into the stadium, but the way in which it was done in this case is procedurally unconscionable. ¶ 36 We also reject the argument by MLB and the Cubs that, regardless of whether the plaintiff actually read the terms and conditions printed on the back of her ticket or website, she undoubtedly had ample opportunity to do so and should therefore be charged with knowledge of the ticket’s terms and conditions. This argument elevates the less important issue of her ability to read the - 24 -  No. 1-20-1264 ticket or the website over the more important question of whether the circumstances brought to the plaintiff’s attention the need to do so in order to become aware of the fact that she was giving up important legal rights by using the ticket or the fact that she had the right to opt out of the arbitration provision within seven days of the game if she took certain steps. As discussed above, it does not seem that the ticket itself or other surrounding circumstances were sufficient to bring this to the plaintiff’s attention. We also question how far in advance of attending a game that a person can reasonably be charged with the need to read the terms and conditions on the back of a baseball ticket, and we believe MLB and the Cubs overstate the realistic opportunity that a person has to read the full arbitration provision on a cellular phone once he or she is within the commotion of entering Wrigley Field and recognizes the need to do so. Furthermore, given that the Cubs omitted from the ticket any information that a person has the right to opt out of arbitration within seven days, this would seem to be an unreasonably short time for a person with injuries as severe as those suffered by the plaintiff to have a meaningful opportunity after the game to learn of the right to opt out of arbitration and take the actions necessary to do so. ¶ 37 Finally, MLB and the Cubs argue that even if we find that the arbitration provision is procedurally unconscionable, we should nevertheless still hold that it is enforceable. MLB and the Cubs are correct that, under Illinois law, an arbitration provision may be found to be procedurally unconscionability to some degree without it being sufficient to render the provision unenforceable. Wigginton, 382 Ill. App. 3d at 1194. They are also correct that there exists a policy in favor of enforcing arbitration agreements. However, this policy means only that we resolve doubts in favor of arbitrability, not that an arbitration clause can never be found unenforceable on the basis of its procedural unconscionability. Id. (citing Roubik, 181 Ill. 2d at 383 ). MLB and the Cubs rely on Kinkel, 223 Ill. 2d at 27 , where the supreme court found a degree of procedural unconscionability - 25 -  No. 1-20-1264 in the cellular service agreement signed by the plaintiff because it did not inform her that she would have to pay part of the costs of arbitration, instead stating that “fee information” was available “upon request.” The court held that the degree of procedural unconscionability at issue was insufficient to render the entire provision unenforceable. Id. They also rely on Bess, 381 Ill. App. 3d at 240, in which the court held that an arbitration provision about which the plaintiff had been informed only after purchasing DirecTV services had a degree of procedural unconscionability, but not one that was sufficient to render the entire provision unenforceable. The court noted that the customer agreement that was provided to the plaintiff after her purchase of services stated that she was not bound by its terms until she had read it and continued to receive the services. Id. at 239. The court also stated that the customer agreement was “typical of consumer agreements for computer, credit card, and other online or catalog purchases wherein the agreements are delivered with the product or the first billing and consumers may approve or reject the terms on receipt of the agreement.” Id. at 239-40 (citing Kinkel, 223 Ill. 2d at 47 ). ¶ 38 In this case, the way by which MLB and the Cubs sought to bind the plaintiff to the arbitration provision set forth in the full terms and conditions on the Cubs’ website or at the administrative offices involved a much greater degree of procedural unconscionability than what was involved in Kinkel or Bess. Thus, we would find that this arbitration provision is unenforceable based on its procedural unconscionability alone. See Razor, 222 Ill. 2d at 99-100 (contract term can be invalidated on the basis of procedural unconscionability alone). However, further bolstering our conclusion of unenforceability is the fact that the arbitration provision bears a degree of substantive unconscionability. Substantive unconscionability concerns the actual terms of the contract and examines the relative fairness of the obligations assumed. Kinkel, 223 Ill. 2d at 28 . Among the circumstances indicative of substantive unconscionability are contract terms so one-sided as to - 26 -  No. 1-20-1264 oppress or unfairly surprise an innocent party. Id. We find this exists to a degree in the arbitration provision at issue, in that it allows an injured person an unreasonably short period of only seven days to opt out of arbitration and requires that a ticketholder “must” include an account number in the request to opt out. The injury suffered by the plaintiff rendered her unable to read or engage in eye-straining activity for at least seven days, and she averred that she had no account number with the Cubs in order to complete an opt-out request in any event. These additional factors support our holding that the arbitration provision at issue is unenforceable. See Razor, 222 Ill. 2d at 99 (a contract term can be invalidated on the basis of procedural unconscionability, substantive unconscionability, or a combination of both). ¶ 39 III. CONCLUSION ¶ 40 For the foregoing reasons, the trial court’s order, denying the motion of MLB and the Cubs to compel binding arbitration, is affirmed. ¶ 41 Affirmed. l_ -27 - No. 1-20-1264 No. 1-20-1264 Cite as: Zuniga v. Major League Baseball, 2021 IL App (1st) 201264 Decision Under Review: Appeal from the Circuit Court of Cook County, No. 20-L-4684; the Hon. Kathy M. Flanagan, Judge, presiding. Attorneys Rami Fakhouri and Brian Karalunas, of Goldman Ismail for Tomaselli Brennan & Baum LLP, of Chicago, and R. Appellant: Adam Lauridsen, Sarah Salomon, and Andrew S. Bruns, of Keker, Van Nest & Peters LLP, of San Francisco, California, for appellants. Attorneys Tracy A. Brammeier, of Clifford Law Offices, P.C., of Chicago, for for appellee. Appellee: - 28 -

2020-12-02 07:14:34.529749+00

http://www.search.txcourts.gov/RetrieveDocument.aspx?DocId=16693&Index=%5c%5c10%2e20%2e4%2e7%5cTamesIndexes%5ccoa05%5cOpinion

DISMISSED; Opinion Filed November 30, 2020 In The Court of Appeals Fifth District of Texas at Dallas No. 05-20-00829-CR EX PARTE LOUIS JAMES BROWN, III On Appeal from the 296th Judicial District Court Collin County, Texas Trial Court Cause No. 296-83597-2019 MEMORANDUM OPINION Before Justices Molberg, Reichek, and Nowell Opinion by Justice Nowell Louis James Brown, III appeals the denial of his post-conviction application for a bond pending appeal. Brown was charged with stalking and represented himself at trial. After finding him guilty, the jury assessed punishment at nine years in prison. Brown then timely filed a notice of appeal; that appeal is pending in cause number 05-20-00064-CR. In August 2020, Brown filed a document entitled “Habeas Corpus/Motion for Bail Pending Appeal” in which he complained of the trial court’s denial of his request for an appeal bond. We treated the document as a notice of appeal of said denial. After the clerk’s record was filed, we notified Brown by letter dated September 24, 2020 that we had concerns regarding our jurisdiction. Specifically, we noted that although the trial court docket sheet indicated the trial court denied Brown’s motion for an appeal bond on August 18, 2020, the record did not contain a final written order on his motion. We informed Brown we would dismiss this appeal unless (1) a supplemental clerk’s record was filed with the trial court’s final written order or (2) Brown filed a letter brief explaining the basis for the Court’s jurisdiction. To date, no supplemental clerk’s record has been filed. And although Brown filed a letter, he conceded that no order had been issued but asked the Court to invoke our jurisdiction and consider his appeal nonetheless. The rules of appellate procedure provide that a criminal defendant has the right to appeal a judgment of guilt or other appealable order. See TEX. R. APP. P. 25.2(a)(2). To perfect an appeal, a notice of appeal must be timely filed after the trial court enters an appealable order. See TEX. R. APP. P. 26.2(a)(1); State v. Rosenbaum, 818 S.W.2d 398 , 402-03 (Tex. Crim. App. 1991) (time for filing appeal runs from date trial judge signs appealable order). An “appealable order” is a signed, written order. State v. Sanavongxay, 407 S.W.3d 252 , 259 (Tex. Crim. App. 2012) (order must be written and signed); State v. Shaw, 4 S.W.3d 875 , 877-78 (Tex. App.— Dallas 1999, no pet.) (State’s appeal must be from signed written order). A docket sheet entry is not an appealable order. See State v. Garza, 931 S.W.2d 560 , 561-62 (Tex. Crim. App. 1996) (docket entry does not constitute “written order”); Shaw, 4 S.W.3d at 878 (same). –2–  Here, there is no written order denying Brown’s motion for an appeal bond. Rather, there is only a notation on the trial court’s docket sheet. Absent a final written order, this Court lacks jurisdiction over the appeal. See TEX. R. APP. P. 25.2(a)(2), 26.2(a); Sanavongxay, 407 S.W.3d at 259 ; Shaw, 4 S.W.3d at 878 . We dismiss this appeal. /Erin A. Nowell/ ERIN A. NOWELL Do Not Publish JUSTICE TEX. R. APP. P. 47.2(b) 200829F.U05 –3–  Court of Appeals Fifth District of Texas at Dallas JUDGMENT EX PARTE LOUIS JAMES On Appeal from the 296th Judicial BROWN, III District Court, Collin County, Texas Trial Court Cause No. 296-83597- No. 05-20-00829-CR 2019. Opinion delivered by Justice Nowell. Justices Molberg and Reichek participating. Based on the Court’s opinion of this date, we DISMISS this appeal. Judgment entered this 30th day of November, 2020. –4–

2021-01-26 21:00:44.973951+00

https://cdn.ca9.uscourts.gov/datastore/memoranda/2021/01/26/20-50151.pdf

NOT FOR PUBLICATION FILED UNITED STATES COURT OF APPEALS JAN 26 2021 MOLLY C. DWYER, CLERK U.S. COURT OF APPEALS FOR THE NINTH CIRCUIT UNITED STATES OF AMERICA, No. 20-50151 Plaintiff-Appellee, D.C. No. 3:17-cr-01507-AJB-1 v. ISRAEL NAVA-ARELLANO, MEMORANDUM* Defendant-Appellant. Appeal from the United States District Court for the Southern District of California Anthony J. Battaglia, District Judge, Presiding Argued and Submitted January 11, 2021 Pasadena, California Before: WATFORD, FRIEDLAND, and BENNETT, Circuit Judges. Israel Nava-Arellano (“Nava”) appeals his 54-month sentence for illegal entry and illegal reentry by a removed alien. See 8 U.S.C. §§ 1325 , 1326. We affirm. Nava first contends that the district court erred in calculating Nava’s Guidelines range by failing to acknowledge that United States Sentencing * This disposition is not appropriate for publication and is not precedent except as provided by Ninth Circuit Rule 36-3. Guidelines (“U.S.S.G.”) § 5G1.2(c) called for his two sentences to run concurrently. We disagree. The district court accurately calculated Nava’s Guidelines range as 30 to 37 months, which implies his two sentences would run concurrently. The court never suggested that the Guidelines envisioned consecutive sentences. Nor did the district court err by imposing an above- Guidelines sentence. The court sufficiently set forth its reasons for varying upward from the Guidelines range and was not required to discuss U.S.S.G. § 5G1.2(c). See United States v. Rangel, 697 F.3d 795 , 801 n.3, 802-03 (9th Cir. 2012). Next, Nava contends that the district court committed a procedural error by failing to recognize its discretion under Kimbrough v. United States, 552 U.S. 85 (2007), to impose a lesser sentence based on a policy disagreement with the Sentencing Guidelines. Specifically, Nava faults the district court for not addressing his policy argument that the Sentencing Guidelines for illegal reentry unfairly “double-count” prior convictions. See U.S.S.G. § 2L1.2. But there is no indication that the district court here misunderstood its discretion under Kimbrough or otherwise—rather, the district court exercised its discretion to vary upward from the Guidelines range. Cf. United States v. Henderson, 649 F.3d 955 , 964 (9th Cir. 2011) (remanding for reconsideration of a Kimbrough argument where the district court’s comments at sentencing suggested a possible failure to appreciate its discretion). And even if the court had erred by neglecting to address Nava’s 2 Kimbrough argument at sentencing, the error would be harmless. Having sentenced Nava on prior occasions, only to have Nava reoffend, the district court explained at length why it felt an upward variance was necessary. It is therefore clear that, if the court had addressed Nava’s “double-counting” policy argument for a below-Guidelines sentence, the court would have rejected it. Nava also attacks the illegal reentry statute itself, 8 U.S.C. § 1326 (b), claiming it is unconstitutionally vague on its face. Nava raised an identical argument in his appeal from his prior sentence, and the panel rejected the argument. See United States v. Nava-Arellano, 795 F. App’x 500, 502 (9th Cir. 2019). That holding is law of the case, and we see no reason to depart from it here. Lastly, Nava contends his above-Guidelines sentence was substantively unreasonable. Again, we disagree. The district court observed that Nava is a “serial violator of the immigration laws,” having been deported numerous times over the past two decades. Moreover, Nava has a lengthy criminal history beyond just immigration offenses. The 54-month sentence was not inappropriate under these circumstances. AFFIRMED. 3

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https://cdn.ca9.uscourts.gov/datastore/memoranda/2021/01/26/19-70174.pdf

NOT FOR PUBLICATION FILED UNITED STATES COURT OF APPEALS JAN 26 2021 MOLLY C. DWYER, CLERK U.S. COURT OF APPEALS FOR THE NINTH CIRCUIT OVIDIO ANTONIO MONTES, No. 19-70174 Petitioner, Agency No. A094-312-948 v. MEMORANDUM* ROBERT M. WILKINSON, Acting Attorney General, Respondent. On Petition for Review of an Order of the Board of Immigration Appeals Submitted January 20, 2021** Before: McKEOWN, CALLAHAN, and BRESS, Circuit Judges. Ovidio Antonio Montes, a native and citizen of El Salvador, petitions for review of the Board of Immigration Appeals’ order dismissing his appeal from an immigration judge’s decision denying his application for asylum, withholding of removal, and relief under the Convention Against Torture (“CAT”), and denying * This disposition is not appropriate for publication and is not precedent except as provided by Ninth Circuit Rule 36-3. ** The panel unanimously concludes this case is suitable for decision without oral argument. See Fed. R. App. P. 34(a)(2). his request to terminate proceedings. We have jurisdiction under 8 U.S.C. § 1252 . We review for substantial evidence the agency’s factual findings. Zehatye v. Gonzales, 453 F.3d 1182 , 1184-85 (9th Cir. 2006). We review for abuse of discretion the denial of a motion to terminate and we review de novo questions of law. Dominguez v. Barr, 975 F.3d 725 , 734 (9th Cir. 2020). We deny the petition for review. Substantial evidence supports the agency’s determination that Montes failed to establish he suffered harm that rises to the level of persecution. See Gu v. Gonzales, 454 F.3d 1014 , 1019-21 (9th Cir. 2006) (“[p]ersecution is an extreme concept, and . . . does not include every sort of treatment our society regards as offensive” (internal quotation and citation omitted)). Substantial evidence also supports the agency’s determination that Montes did not establish a well-founded fear of future persecution. See id. at 1022 (petitioner failed to present “compelling, objective evidence demonstrating a well-founded fear of persecution”). Thus, Montes’s asylum claim fails. In this case, because Montes failed to establish eligibility for asylum, he failed to establish eligibility for withholding of removal. See Zehatye, 453 F.3d at 1190 . Substantial evidence supports the agency’s denial of CAT relief because Montes failed to show it is more likely than not he will be tortured by or with the 2 19-70174 consent or acquiescence of the government if returned to El Salvador. See Aden v. Holder, 589 F.3d 1040 , 1047 (9th Cir. 2009); see also Zheng v. Holder, 644 F.3d 829 , 835-36 (9th Cir. 2011) (possibility of torture too speculative). The BIA did not abuse its discretion in denying Montes’s request to terminate proceedings, where Montes’s contention that the immigration judge lacked jurisdiction over his proceedings is foreclosed by Aguilar Fermin v. Barr, 958 F.3d 887 , 895 (9th Cir. 2020) (omission of certain information from a notice to appear can be cured for jurisdictional purposes by later hearing notice). As stated in the court’s April 3, 2019 order, the temporary stay of removal remains in place until issuance of the mandate. PETITION FOR REVIEW DENIED. 3 19-70174