Justia U.S. 10th Circuit Court of Appeals Opinion Summaries
Articles Posted in Government & Administrative Law
Bork v. Carroll
Plaintiff-Appellant Douglas Bork, a member of the United States Army Reserve, sought to challenge personnel decisions made by his sergeant, superior officers and the Secretary of Defense. Plaintiff sought to sue those individuals and have the Tenth Circuit enjoin their "putatively unlawful actions." The district court dismissed Plaintiff's claims for lack of subject matter jurisdiction. On appeal to the Tenth Circuit, Plaintiff argued that "Feres v. United States" gave him the legal authority to sue the United States. The Court found that "Feres" involved an express statutory waiver of sovereign immunity, but for claims brought under the Federal Tort Claims Act. Plaintiff did not bring an FTCA claim in this case. With no applicable legal authority under which Plaintiff could maintain his suit, the Court dismissed his case for lack of jurisdiction.
Almond v. Unified Sch. Dist. #501
Two former employees of the Kansas Unified School District #501 filed administrative charges against the District following claims of wage discrimination. Dwight Almond, III and Kevin Weems were both offered and accepted new positions with lesser pay within the District rather than be fired from a District-wide downsizing effort. Both filed their claims in 2006, several years after the alleged pay discrimination took place. The district court held that the men had waited too long to seek administrative review, and that delay had the effect of barring their lawsuits altogether. In the pendency of the employees' appeal of the district court's dismissal, Congress enacted the "Ledbetter Act" specifically aimed at addressing "discrimination in compensation" claims in which members of a protected class receive less pay than similarly situated colleagues. The employees raised multiple claims on appeal, including a violation of the Ledbetter Act. Upon review of the district court record, the Tenth Circuit concluded that because the employees in this case didn't raise an unequal pay for equal work claim, they did not benefit from the Act’s comparatively generous deadlines, so preexisting accrual rules applied. Under those rules, the employees' claims were untimely and accordingly dismissed.
Winters v. Jordan
Plaintiff Katherine Winters filed this lawsuit pursuant to 42 U.S.C. 1983 alleging violations of an asserted right to the care and custody of her biological grandchildren. She named the State of Kansas, the state Department of Social and Rehabilitation Services, social workers and their supervisors and the state court judge who ruled on the "Child in Need of Care" (CINC) matter relating to all three children and the adoption proceeding of her grandson "C.W.," as well as a prosecutor, guardian ad litem and court-appointed special advocates. Plaintiff requested remedies including declaratory and injunctive relief voiding state-court placement and adoption orders, plus compensatory damages of $67 million and punitive damages. The district court dismissed the action, and Plaintiff appealed. On appeal, Plaintiff argued that the district court erred in its determinations on subject-matter jurisdiction, defendants’ immunity, and the sufficiency of her complaint. Her fundamental argument was that the district court failed to give proper consideration to her claim of a constitutional right to the custody and care of C.W. Having carefully reviewed the record on appeal and the appellate briefs in the light of the governing law, the Tenth Circuit agreed with the district court’s analysis of Plaintiff's claims. The Court therefore affirmed the judgment of the district court.
CFTC, et al v. Lee, et al
The United States Commodity Futures Trading Commission (CTFC) and the Oklahoma Department of Securities brought suit against multiple corporate defendants (including Prestige Ventures Corporation) and several individuals, Kenneth Lee and his wife and two sons, Simon Yang. The Lees and Mr. Yang appealed pro se a district court's order entered in favor of CTFC. In their complaint, the CTFC alleged that defendants operated a Ponzi scheme that bilked at least 140 investors out of millions of dollars, in violation of a number of provisions of the Commodity Exchange Act and the Oklahoma Uniform Securities Act of 2004. Plaintiffs also alleged that millions of dollars were funneled to Defendants from Prestige by Mr. Lee, in cash and in the form of houses, cars, and boats. The court authorized a receiver to take possession of and sell the houses and boats. further, the court entered a broad array of permanent injunctive orders prohibiting defendants from further dealings in commodity futures and transacting investment-related business in Oklahoma. The court further ordered Defendants to pay over $5 million in restitution and a number of penalties, and ordered Defendants to disgorge large sums of cash. Each of the Lees filed a substantively identical motion for reconsideration of the Order. Having considered these issues and having reviewed the briefs, the record,and the applicable law in light of the applicable review standards, the Tenth Circuit affirmed the judgment of the district court for substantially the reasons stated in the district court’s order of summary judgment and its Order.
CCCOK Inc. v. Southwestern Bell, et al
In 2005, Appellant CCCOK, Inc. filed a complaint at the Oklahoma Corporation Commission (OCC) against Southwestern Bell Telephone, L.P.(SWBT). CCCOK sought an order directing SWBT to pay it over two-million dollars in compensation for SWBT's alleged breach of a contract between them. The OCC rejected CCCOK’s claim, concluding that CCCOK was not entitled to compensation under the "clear and unambiguous" language of the Parties' contract. The federal district court affirmed the OCC's ruling. CCCOK appealed. On appeal, CCCOK contended that the OCC's ruling was arbitrary and capricious because it: (1) disregarded the terms of the parties' contract; (2) contradicted record evidence; and (3) violated CCCOK's rights under state and federal law. Upon review, the Tenth Circuit concluded that the OCC's ruling was not arbitrary and capricious and it affirmed the district court's decision.
United States v. Springer
A jury convicted Lindsey Springer of one count of conspiring with Oscar Stilley to defraud the United States, three counts of tax evasion, and two counts of willful failure to file a tax return. Mr. Stilley was convicted of one count of conspiracy and two counts of aiding and abetting Mr. Springer’s tax evasion. The district court sentenced both men to fifteen years in prison, three years of supervised release, and restitution for tax losses exceeding $2 million. Mr. Springer and Mr. Stilley (Defendants) respectively challenged their convictions and sentences. Mr. Springer founded "Bondage Breakers Ministries" to offer legal and tax advice to individuals embroiled in tax disputes for which he was paid thousands upon thousands of dollars. He eventually met Mr. Stilley (now a disbarred lawyer) and together they devised a scheme to channel Mr. Springer's unreported income through Mr. Stilley's client trust account. "By 2005, Mr. Springer had gained the full attention of the IRS." The government executed a search warrant of Mr. Springer's residence, and Mr. Stilley was served with a grand jury subpoena. During the course of the investigation, Defendants denied receiving any income for their advice, representing instead that people simply made donations to Mr. Springer’s ministry, with no expectation of services in return. But at trial, the government refuted those statements, offering testimony from numerous witnesses who had paid large sums of money to defendants in exchange for their supposed tax and legal expertise. Based on this and other evidence, the jury convicted Defendants on all counts to which Defendants appealed. Upon review, the Tenth Circuit affirmed Defendants' convictions for substantially the same reasons articulated by the district court. The Court affirmed Defendants' respective convictions and sentences.
Eugene S. v. Horizon Blue Cross Blue Shield
Plaintiff-Appellant Eugene S. appealed a district court's denial of his motion to strike and its entry of summary judgment in favor of Defendant-Appellee Horizon Blue Cross Blue Shield of New Jersey (Horizon BCBSNJ). Plaintiff sought coverage for his son A.S.'s residential treatment costs from his employer's ERISA benefits insurer. Horizon's delegated plan administrator originally denied the claim. Having exhausted his administrative appeals, Plaintiff filed suit in district court challenging the denial of benefits. The parties filed cross-motions for summary judgment, but Horizon also filed a declaration that included the terms of Horizon's delegation of authority to the plan administrator to administer mental health claims in a Vendor Services Agreement. Plaintiff moved to strike that declaration as procedurally barred. The district court denied the motion and granted Horizon summary judgment, finding that neither Horizon nor its plan administrator acted in an arbitrary or capricious manner in denying the contested claim. Upon review, the Tenth Circuit found substantial evidence in the record that A.S. did not meet the criteria for residential treatment benefits under the plan, and as such, the plan administrator did not act in an arbitrary or capricious manner in denying Plaintiff's claim. The Court affirmed the district court's judgment.
Klen v. City of Loveland
Plaintiffs Edward Klen, Diverse Construction, Stephen Klen and Holstein Self-Service Storage, LLC brought a civil rights lawsuit against the City of Loveland Colorado and various City employees alleging "a plethora" of constitutional violations involving: the defendants' alleged imposition of deliberate delays and unreasonable requirements for Plaintiffs' building permit; solicitation of illegal and extortionate fees for the permit; use of perjury in criminal ordinance violation proceedings; retaliation for plaintiffs' exercise of their First Amendment rights; forgery of Plaintiffs' permit application to facilitate a wrongful prosecution; and trespassing by a building inspector. The district court granted summary judgment in favor of the Defendants on Plaintiffs' federal claims and declined to exercise supplemental jurisdiction over their state-law claims. Plaintiffs appealed the grant of summary judgment. Upon review, the Tenth Circuit could not agree with the district court's conclusion that there was no causal connection between an alleged affidavit used to support Plaintiffs' claim that they were being selectively prosecuted and the outcome of that prosecution. "It is not possible to determine on this record whether, absent the affidavit, the state municipal court would have dismissed the
prosecution against Ed Klen, obviating the need for a no contest plea to avoid the possibility of a trial and even of jail time for the offenses. We therefore reverse summary judgment as to this claim." The court affirmed the district court in all other respects.
Richardson v. Astrue
Plaintiff-Appellant Thomas Richardson appealed a district court's order that affirmed the Commissioner of Social Security's denial of his application for Childhood Disability Benefits. Plaintiff filed two applications: one for Childhood Disability Benefits as a Disabled Adult Child and another for Supplemental Security Income benefits. Plaintiff was diagnosed with Asperger's Disorder; the examining physician opined that Plaintiff had a "fairly severe disability" such that he probably would not be able to find a job or remain employed. Both of Plaintiff's applications were initially denied. The ALJ found no evidence that Plaintiff was under a disability beginning before his twenty-second birthday, and that his impairment did not prevent him from performing unskilled work. The Commissioner affirmed the ALJ. After the Appeals Council denied review, Plaintiff filed an action in district court seeking reversal of the Commissioner’s decision denying his claim. The district court affirmed the Commissioner’s decision, and Plaintiff filed a timely appeal. On appeal, the Commissioner initially asserted that the ALJ’s findings were largely consistent with the examining physician's findings. However, upon review, the Tenth Circuit concluded that the ALJ made no such findings: the ALJ did not mention the physician's opinion "much less evaluate whether it was supported by the record." The Court remanded the case back to the ALJ to perform a proper evaluation of the physician's opinion.
Cody Laboratories, Inc. v. Sebelius
Cody Laboratories, Inc. and Lannett Co., Inc. (collectively, "Cody") appealed a district court's dismissal of their action for declaratory judgment against the Food and Drug Administration (FDA). Cody has been manufacturing and distributing morphine sulfate since 2005. At the time Cody filed its complaint, the company had not received FDA approval for its morphine sulfate product. Cody contends that the product falls under the "grandfather clause" of the Food, Drug, and Cosmetic Act (FDCA). The FDA claims that the grandfather clause is exceedingly narrow and applies only to drugs that have been marketed in essentially identical form since 1938. The FDA sent Cody a warning letter in March 2009 stating that Cody's manufacture and distribution of morphine sulfate was in violation of the FDCA. Meanwhile, in August 2009, Roxane Laboratories, Inc., Cody's main competitor, submitted a New Drug Application ("NDA") for its own morphine sulfate product. Following its policy of granting expedited review of an NDA if no approved alternative drug exists, the FDA quickly reviewed and approved Roxane's NDA in January 2010. Cody submitted an NDA for its product the following month. The company's requests for expedited review were denied. Cody brought suit claiming the FDA acted arbitrarily, capriciously and contrary to law in violation of the Administrative Procedure Act by: (1) improperly determining that Cody's product was a "new drug" and thus not entitled to grandfathered status under the FDCA; and (2) treating Cody disparately from Roxane in processing the companies' respective NDAs. The court subsequently dismissed Cody's complaint for lack of jurisdiction, holding that the FDA had yet to complete "final agency action" under section 704 of the APA. Upon review of the record, the Tenth Circuit concluded that one of Cody's claims was mooted by post-judgment events and that Cody failed to exhaust available administrative remedies with respect to its remaining claim. The Court affirmed the district court's dismissal for lack of jurisdiction on the grandfathering claim, and dismissed Cody's disparate treatment claim as moot.